Saheed Ahmed
The death of 37 people in Niger State should force Nigeria to confront a difficult truth about our mining industry: we cannot police our way out of an economic problem.
On September 17, 2026, 37 people who had been detained in Niger State on suspicion of illegal mining died while in the custody of the Nigeria Security and Civil Defence Corps. The circumstances of their deaths remain the subject of an independent investigation established by the Federal Government. The government has suspended officers connected with the incident and constituted a 10-member committee to investigate what happened.
Whatever the final findings of that investigation may be, the tragedy should become a catalyst for a much larger national conversation about artisanal and small-scale mining.
I write this not simply as an observer, but as a practitioner. Through Cap9 Minerals, we operate and evaluate mineral opportunities across Nigeria and other African mining jurisdictions. We see every day the gap between the geological potential of African deposits and the capital, technology, equipment and technical expertise available to the people actually extracting those minerals.
Nigeria’s artisanal miners are often described as the problem. I believe many of them are actually the first participants in what could become a much larger mining industry.
The question is whether Nigeria will help them make that transition. From artisanal mining to productive mining Artisanal mining exists because there is economic value in the ground.
A young man (or woman) does not leave school, travel to a remote mining community and spend his day digging through rock, soil or river sediments because he has an ideological commitment to illegal mining.
He or she does it because there is gold, tin, lithium, tantalite, lead, zinc or another mineral—and because mining represents an economic opportunity. The problem is that too much of Nigeria’s mineral production is still taking place at the lowest end of the value chain.
The typical artisanal operator does not have geological data, modern exploration equipment, appropriate excavation machinery, efficient processing technology, environmental management systems, occupational safety systems or affordable working capital.
The result is predictable: Low recovery, high risk, environmental degradation, lost government revenue and limited value creation. At Cap9 Minerals, when we examine deposits, one of the first questions is not simply “Is there gold?”
It is: How much economically recoverable mineralisation is there, what technology is required to recover it, what is the capital requirement, and can the operation be converted into a sustainable commercial mining business? That is the difference between digging and mining.
The missing middle
Nigeria has spent considerable time discussing artisanal mining on one side and large multinational mining companies on the other. Compared to more advanced markets such as South Africa and Tanzania where medium to large scale represents over 75 percent of the market, Nigeria is the exact opposite with less than 25 percent.
But there is a missing middle. Medium-scale mining.
This is where I believe Nigeria’s greatest immediate opportunity lies. A properly financed medium-scale operation can take an existing artisanal mining community and introduce: Geological exploration and resource definition; mechanised excavation; proper mine planning; processing plants; gravity concentration and other appropriate recovery technologies; laboratory testing and assaying; occupational health and safety; environmental management; traceability and responsible sourcing; formal employment; tax and royalty payments; and transparent mineral sales.
Instead of 100 people working independently with shovels and improvised equipment, a properly structured mining operation can create an integrated business employing hundreds of people directly and many more through contractors, logistics, engineering, security, catering, equipment maintenance and mineral processing.
This is not about eliminating artisanal miners. It is about graduating them.
Nigeria’s Ministry of Solid Minerals Development already recognises the importance of formalisation, extension services, mining clusters, safer mining techniques and access to finance for artisanal and small-scale miners. The policy direction is therefore clear. What is missing is scale. The financing problem.
Mining is different from most businesses. A manufacturer can show a bank its factory, machinery, historical cash flow and inventory. A miner may have something potentially worth billions of naira underground—but before that mineral can become revenue, the company may need to spend significant amounts on geological exploration, drilling, assays, feasibility studies, environmental approvals, roads, power, water, equipment and processing infrastructure.
And the biggest risk is that the mineral deposit may not ultimately be economically viable. That makes conventional bank lending difficult. Commercial banks understandably do not want to lend long-tenor money against an unproven geological proposition.
This is why virtually every serious mining jurisdiction has developed institutions, capital markets, development-finance mechanisms or specialised investors capable of taking geological and project-development risk. Nigeria needs to do the same.
The Mining Development Bank of Nigeria Bill
This is why the proposed Nigerian Mining Development Bank (NMDB) deserves serious national attention. The Nigerian Mining Development Bank Bill, HB 808, sponsored by Hon. Uchenna Harris Okonkwo, proposes a specialised institution to provide financial support and credit facilities to individuals, cooperatives and companies involved in mining, while also supporting investment, technical expertise, research, technology and sustainable mining practices.
The bill passed second reading in the House of Representatives in March 2024. In July 2026, the House adopted the committee report on the bill, demonstrating that the proposal remains part of the current legislative process.
For Nigeria’s mining industry, the significance of such an institution goes beyond simply creating another government bank.
The objective should be to create a specialised mining-finance ecosystem. The bank should understand geological risk. It should understand mining feasibility studies. It should understand reserves and resources. It should understand equipment finance. It should understand offtake agreements. It should understand project finance. And importantly, it should understand that mining projects can take years to develop before they generate meaningful cash flow.
What the Mining Development Bank should actually finance
If established, the NMDB should not become a conventional bank that simply asks mining companies for collateral and audited historical cash flows. That would defeat the purpose. Instead, it should operate across the mining-development lifecycle. The objective should not be to eliminate smaller miners.
It should be to create an ecosystem in which capital, technology and geological expertise allow economically viable deposits to graduate into increasingly productive operations.
Canada is a useful illustration of what a mature mining ecosystem looks like. In 2024, Canada produced more than 60 minerals and metals worth C$64.3 billion and attracted C$4.1 billion in mineral exploration investment. Its 2024 inventory contained 138 major mining projects with a combined potential investment value of C$117.1 billion. The lesson for Nigeria is not that artisanal mining should disappear.
The lesson is that industrial and professionally financed mining must become the dominant engine of mineral production and value creation, while smaller operators are integrated into a formal supply chain.
Even within Africa, Ghana demonstrates why the answer is more nuanced than simply attacking small-scale mining. In 2024, Ghana’s large-scale gold producers accounted for about 60.6% of national gold output, while licensed small-scale production accounted for approximately 39.4%. That is an important lesson. Small-scale mining can be economically significant.
But it becomes far more valuable to the national economy when it is formal, licensed, financed, monitored and connected to legitimate processing and export channels. Nigeria’s numbers should concern us.
Nigeria’s mining potential is enormous, yet the contribution of solid minerals to the economy remains remarkably small.
According to NEITI’s 2023 Solid Minerals Industry Audit, the solid minerals sector contributed approximately 0.75% of Nigeria’s GDP in 2023. Solid-mineral exports were only about 0.28% of total exports that year.
Compare that with the ambition contained in Nigeria’s mining roadmap.
The country’s mining roadmap identified a pathway toward approximately 10% of GDP from the mining sector, directly and indirectly. The gap between approximately 0.75% and 10% is enormous.
We cannot close that gap by simply arresting miners. We cannot close it by issuing more licences alone.
And we certainly cannot close it by expecting commercial banks to finance geological risk as though mining were a conventional trading business. We need capital formation.
What would getting to 10% actually require?
If Nigeria is serious about making mining contribute more than 10% of GDP, I would suggest five national priorities.
First: Formalise the artisanal sector—not criminalise poverty
Where an area is geologically viable, government should organise miners into cooperatives, clusters or structured operating companies. Give them access to technical support. Give them geological information. Give them defined operating areas. Give them environmental obligations. Give them access to finance. Then enforce the law against operators who refuse to comply. There is a fundamental difference between formalising an informal miner and tolerating illegal mining.
Nigeria needs to do the first while aggressively addressing the second.
Second: Build thousands of medium-scale mines
Nigeria does not need to wait for 20 multinational mining companies to transform the sector. Imagine hundreds of properly financed medium-scale operations across gold, lithium, tin, tantalite, iron ore, barite, lead-zinc, limestone and other minerals. Each operation could become an economic hub.
Each mine could support engineers, geologists, equipment operators, laboratories, transporters, processors, security companies, financial institutions and local suppliers. That is how mining becomes an industry rather than simply an extraction activity.
Third: Finance the entire mining value chain
The Mining Development Bank should work with the Solid Minerals Development Fund, commercial banks, pension funds, development-finance institutions, equipment manufacturers and international investors. Nigeria already has the SMDF, whose mandate includes catalysing private-sector investment and financing projects across exploration, development and production.
Fourth: Stop exporting the opportunity
If Nigeria produces lithium ore, gold concentrate, tin ore or other mineral commodities, the national objective should increasingly be to capture more value before those minerals leave the country.
Mining should connect to: Processing + refining + manufacturing + logistics + technology + financial services. That is where the real economic multiplier lies.
Fifth: Make safety non-negotiable
The Niger tragedy should remind us that mining is not an industry where safety can be treated as an afterthought. Proper mine design, ventilation, geotechnical assessments, PPE, emergency response, environmental controls, equipment maintenance and worker training are not luxuries. They are basic requirements of a modern mining industry. A properly financed mine can afford them. An impoverished artisanal miner often cannot. That is another reason capital matters. The security argument There is also a national-security dimension. Where legitimate economic opportunities disappear, illicit markets fill the vacuum. Where mineral production is unregulated, criminal networks can exploit the supply chain. Where miners have no formal access to finance or markets, they become dependent on informal financiers, intermediaries and sometimes criminal actors.
Formalising the industry therefore serves more than an economic purpose. It strengthens traceability. It improves taxation. It improves security. It protects communities. And it allows government to know who is mining, where they are mining, what they are producing and where the minerals are going.
Mining can become Nigeria’s next major economic engine. Nigeria has spent decades talking about economic diversification. Perhaps we have been looking at diversification too narrowly. Mining is not simply about digging minerals out of the ground.
It can become an ecosystem encompassing: Geology, finance, engineering, equipment manufacturing, construction, logistics, technology, energy, processing, refining and manufacturing. That ecosystem can create skilled jobs and generate foreign exchange while developing economic activity far beyond the mine site. But the transition will not happen automatically. It requires deliberate policy. It requires patient capital. It requires competent operators. It requires reliable geological data. It requires infrastructure. It requires regulatory certainty.
And above all, it requires a willingness to treat mining as an industry—not as an activity that should be tolerated only when government needs revenue.
From crisis to opportunity
The tragedy involving the 37 people in Niger State should not be reduced to another cycle of outrage, arrests, investigations and forgotten recommendations. The independent investigation must establish the facts and accountability must follow where wrongdoing is established.
But Nigeria should also ask a much bigger question: Why are so many Nigerians willing to risk their lives mining minerals in the first place? The answer is partly economic. Nigeria has mineral wealth.
Nigeria has entrepreneurs. Nigeria has engineers and geologists. Nigeria has millions of people seeking productive livelihoods. What Nigeria has lacked is the bridge connecting these resources. That bridge is capital.
The Mining Development Bank can become an important part of that bridge if it is designed as a genuine mining-development institution rather than simply another financial institution.
The goal should be ambitious: Take Nigeria from artisanal extraction to mechanised medium-scale mining. Take medium-scale mines into large-scale commercial operations. Take raw minerals into processing and refining. Take processing into manufacturing.
And ultimately: Take mining from less than 1% of GDP toward—and eventually beyond—the 10% ambition that Nigeria’s own mining roadmap has identified. Nigeria does not lack minerals. We have known that for generations.
What we need now is the capital, institutions, technology and political will to turn those minerals into productive assets, sustainable businesses and broad-based national prosperity. That is the real opportunity before us.
And it is why the future of Nigeria’s mining sector cannot simply be about stopping illegal mining. It must be about creating so much legitimate mining that illegal mining becomes economically and socially obsolete.
Ahmed is the Abuja based Chief Executive Officer (CEO) of Cap9 Minerals