Nigeria Cracks Down on Illegal Mining to Secure Critical Minerals Revenue
Nigeria’s intensified crackdown on illicit mining operations and push for domestic processing aims to secure billions in tax revenue and position the country to capitalize on surging global demand for critical minerals.
The Nigerian Federal Government has sealed an illegal gold mining site in Osun State and is actively pursuing the financiers behind illicit operations. A joint task force shut down the facility at Ileki Ijesa, arrested two suspects, and confiscated mining equipment.
Minister of Solid Minerals Development Dele Alake confirmed the suspects are cooperating to identify their sponsors. "I want to be clear that our focus isn’t just on the casual workers on the ground," Alake stated, emphasizing a strategy to dismantle the criminal networks funding these activities.
This operation is part of a wider enforcement drive that has seen Mining Marshals arrest over 300 illegal miners and prosecute more than 150 individuals, including foreign nationals. Recent actions include the May 2025 deportation of four Chinese nationals and the forfeiture of N134 million to the state, alongside July 2025 arrests by the EFCC in Akwa Ibom State.
Securing Fiscal and Strategic Value
The crackdown directly supports efforts to formalize a sector that is becoming increasingly vital to public finances. According to the National Bureau of Statistics, mining and quarrying generated N686.96 billion in VAT and N723.33 billion in Company Income Tax in 2025, representing significant growth from 2024 figures.
Beyond enforcement, Abuja is aggressively promoting domestic mineral processing to reduce reliance on raw exports. Recent milestones include a $200 million lithium mining and processing plant commissioned in Zamfara State and a new facility in Nasarawa State with an annual processing capacity of three million metric tonnes.
These investments align with a projected 353 percent increase in global lithium demand between 2024 and 2040, driven by electric vehicles and renewable energy technologies. The recent discovery of a polymetallic province in Kaduna State, containing lithium, gold, and rare earth elements, further underscores the country’s strategic potential.
By sanitizing the sector and building local processing capacity, Nigeria aims to capture a larger share of the global critical minerals market. For institutional investors, this dual strategy signals a maturing regulatory environment that penalizes illicit operators while rewarding formal, value-added industrial partnerships.
