A case for legal, policy reforms for critical minerals development in Nigeria

BY COLLINS OKEKE AND GUKONGOZI UGWUEZI

As the global economy pivots toward clean energy and advanced technologies, nations with critical mineral reserves find themselves at a strategic crossroads. The recent US-Ukraine partnership, formalized through a joint investment fund in April 2025, demonstrates how countries can leverage their mineral wealth—including titanium, lithium, and uranium—to attract international investment and drive reconstruction efforts. This partnership underscores a critical reality: in today’s economy, mineral resources are not just commodities but instruments of geopolitical and economic power.

Nigeria possesses similarly vast critical mineral reserves, yet the country has largely failed to capitalize on this strategic advantage. Despite holding significant deposits of lithium, tantalite, tin, and other minerals essential to modern technology, Nigeria’s mining sector contributes less than 1% to GDP—a stark contrast to countries that have transformed their mineral wealth into economic prosperity. The root cause lies in Nigeria’s fragmented and outdated legal framework, which fails to provide the regulatory clarity, investment incentives, and governance structures necessary to attract serious capital or ensure sustainable development.

The cost of inaction is mounting. While other resource-rich nations are securing partnerships and building value-added industries, Nigeria risks becoming a mere exporter of raw materials, missing the opportunity to participate meaningfully in the global clean energy transition. This article examines Nigeria’s untapped critical mineral potential, identifies the specific legal and policy barriers preventing its realization, and proposes a comprehensive reform agenda that could position Nigeria as a key player in the global critical minerals market.

Understanding Critical Minerals and Nigeria’s Endowment

Critical minerals are natural resources that hold substantial economic importance yet face potential supply risks due to geopolitical factors, limited production sources, or concentration in specific regions. These minerals are vital components in various modern applications, including renewable energy technologies, defence systems, electronics, and telecommunications, with few viable substitutes for their unique properties. Examples include rare earth elements essential for magnets in wind turbines and electric vehicles, lithium and cobalt for batteries, platinum group metals for catalytic converters, gallium and indium for semiconductors, titanium and niobium for aerospace applications, and manganese for steel production. Countries typically maintain and update their lists of critical minerals based on their specific economic requirements and vulnerability assessments, with these designations evolving alongside technological advancements, shifting geopolitical landscapes, and changing market dynamics.

Nigeria is endowed with substantial reserves of globally significant critical minerals that position the country as a potential key player in the global energy transition supply chain. The country’s critical mineral wealth includes lithium deposits in Nasarawa, Kogi, and Kwara states, which are essential for electric vehicle batteries and renewable energy storage systems. The Jos Plateau region hosts valuable columbite-tantalite deposits containing tantalum and niobium, minerals crucial for manufacturing electronic components, superalloys, and specialised steel products. This same region also contains notable tin deposits, while promising rare earth element occurrences, though not fully explored, have been identified across the country – these elements are indispensable for producing permanent magnets used in wind turbines and electric vehicles. Additionally, Nigeria possesses graphite resources across several states, a mineral vital for battery anodes, lubricants, and numerous industrial applications that support modern manufacturing and energy technologies.

Current Governance Framework for Critical Minerals in Nigeria

Despite Nigeria’s rich endowment of critical minerals, the country’s approach to governing these resources is embedded within its broader mining sector framework, with limited specific provisions for these strategic materials. The Nigerian Constitution 1999 and Minerals and Mining Act (2007) establish state ownership of all mineral resources and provide the fundamental legal framework for mineral exploration and exploitation. The Nigerian Minerals and Mining Regulations (2011) and the National Minerals and Metals Policy (2008) set strategic guidelines, technical standards, and operational requirements for sustainable development of Nigeria’s solid minerals and metals sector. The policy outlines important governance pillars, including transparent licensing procedures, comprehensive geological mapping, and fiscal incentives to encourage local mineral processing. However, this framework did not adequately address the specific governance needs of critical minerals. It lacked a robust classification framework or any mechanism for risk-based prioritization of these resources.

The governance structure includes the Ministry of Mines and Steel Development (MMSD), Nigerian Geological Survey Agency (NGSA), Mining Cadastre Office (MCO), and Council of Nigerian Mining Engineers and Geoscientists (COMEG). While these institutions provide general oversight, they lack mandates specifically tailored to critical minerals management. Recent initiatives like the National Policy on Solid Minerals (2019), Presidential Artisanal Mining Initiative, and the Roadmap for the Growth and Development of the Nigerian Mining Industry have begun to recognize the importance of critical minerals, but implementation remains incomplete.

The existing legal and policy regime suffers from several critical shortcomings that hinder effective governance of these strategic resources. Most notably, there is an absence of comprehensive critical minerals classification, with no comprehensive legal definition or list of critical minerals specific to Nigeria and a lack of differential treatment for critical versus non-critical minerals. This classification gap is compounded by weak implementation and enforcement, evident through limited capacity to enforce existing regulations and significant illegal mining and smuggling of critical minerals.

Data limitations present another significant challenge. The country faces incomplete geological data on critical mineral deposits and limited understanding of its full resource potential. This knowledge gap undermines strategic planning and inhibits investor confidence. Additionally, value chain development is hindered by minimal legal frameworks for promoting domestic processing and limited incentives for value addition within Nigeria.

Environmental and social safeguards are also insufficient, providing inadequate protections for communities impacted by critical minerals mining and insufficient environmental standards specific to critical minerals extraction. The investment framework lacks targeted incentives for critical minerals development and has insufficient mechanisms to attract the technology and expertise needed to develop these resources responsibly and efficiently.

Global Context and Proposed Legal and Policy Reforms

To address these challenges effectively, it is essential to examine how other countries are approaching critical minerals governance. Global trends in this field provide important context for Nigeria’s reform efforts. Countries worldwide are moving beyond traditional mining regulations toward more strategic frameworks that recognise the unique importance of these resources. National security integration has become paramount, with countries developing strategic reserves and implementing supply chain protection measures. Supply chain resilience features domestic processing requirements and anti-concentration measures to prevent overdependence on single sources.

Sustainability integration is increasingly important in global mineral governance, with ESG compliance requirements and carbon footprint regulations becoming standard. Indigenous and community rights are receiving greater attention through strengthened consent requirements and mandatory benefit-sharing mechanisms. Public-private partnerships are emerging through co-investment models and risk-sharing frameworks that distribute the burden of development.

Drawing from these global best practices and addressing Nigeria’s specific challenges, several key reforms should be considered to protect and maximise the value of the country’s critical mineral resources:

First, Nigeria should establish a dedicated critical minerals legal framework by developing and enacting a Critical Minerals Act that specifically addresses the unique challenges and opportunities of these resources. The country needs to create a formal, science-based classification system for critical minerals relevant to Nigeria’s development needs and establish differential regulatory treatment based on mineral criticality.

Second, institutional capacity must be strengthened by creating a dedicated Critical Minerals Agency or Department within MMSD. This specialised unit would focus exclusively on critical minerals governance, ensuring these strategic resources receive the attention they deserve. A multi-stakeholder Critical Minerals Council should also be established to coordinate policy across government and industry. Additionally, specialised training programmes for regulators and inspectors would ensure proper oversight of this specialised sector.

Third, Nigeria must enhance its geological knowledge through a comprehensive National Critical Minerals Mapping Initiative to fully understand its resource potential. This would address the data limitations identified earlier and provide the foundation for strategic decision-making. Investment in modern geological survey technologies is essential for this effort, as is establishing public-private partnerships for exploration that can bring in technical expertise and funding.

Fourth, value chain integration policies are needed to move Nigeria beyond being merely a source of raw materials. This should include local processing requirements for critical minerals to capture more value domestically. Fiscal incentives for downstream activities would encourage investment in processing facilities, while creating special economic zones focused on critical minerals processing could fast-track industrial development.

Beyond these four core reforms, complementary measures are also needed. The investment framework requires specific attention through targeted incentives for critical minerals projects and risk-sharing mechanisms for strategic minerals development. Environmental and social governance must be strengthened with specific standards for critical minerals operations and enhanced community development agreement requirements. Combating illegal mining through stronger penalties and formalisation pathways for artisanal miners is crucial to ensure that Nigeria’s critical minerals benefit the treasury rather than shadow economies. Finally, international partnerships through bilateral agreements with technology-manufacturing countries would help position Nigeria as a preferred supplier in global value chains.

Conclusion

The global race for critical minerals presents Nigeria with a historic opportunity to transform its abundant geological resources into drivers of economic development. By implementing thoughtful legal and policy reforms as outlined above, the country can move beyond being merely a source of raw materials to become a key player in global critical mineral value chains. These reforms should be guided by several key principles: a strategic vision that recognises critical minerals as national assets essential for future development; sustainability approaches ensuring extraction benefits present and future generations; value addition strategies that capture processing value within Nigeria; community benefit frameworks that ensure local populations share in resource wealth; and global integration efforts that position Nigeria as a responsible supplier in international supply chains.

By implementing comprehensive legal and policy reforms focused on critical minerals, Nigeria can secure not just the minerals themselves, but also the foundation for technological advancement, economic diversification, and sustainable development in the decades ahead. The stakes could not be higher – these resources represent the building blocks of the 21st century economy. As global demand surges and competition intensifies, countries with forward-looking legal and policy frameworks will be best positioned to benefit from the critical minerals revolution. Nigeria has the geological endowment—now it needs the governance framework to match.