Nigeria’s lithium boom struggles to benefit its communities

Nigeria is looking to cash in on a global lithium mining boom while trying to avoid the curse of environmental damage, community grievance, and corruption that has scarred more than half a century of oil exploitation in the country’s southern delta region.

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Nigeria’s lithium belt, stretching from Oyo in the southwest to Kano in the north, is estimated to be worth more than $34 billion. Although it is not a top-10 producer, Nigeria’s lithium is considered high-grade, and the government is moving aggressively to expand its processing capacity to meet the soaring demand for lithium-ion batteries at the heart of the world’s clean energy transition.

With the right policies in place, Nigeria could boost economic growth, create jobs, and advance rural livelihoods. But in the rush to exploit its reserves, a price could also be paid by local communities impacted by the environmental pollution, land degradation, and insecurity that often accompany poorly regulated resource extraction.

The New Humanitarian, in collaboration with PREMIUM TIMES, is launching a series of reports exploring the humanitarian and rights-based challenges associated with the lithium boom, and the measures that could be taken to avoid exploitation and maximise community benefits.

A postponed promise

Foreign mining investors are piling into Nigeria, led by China, as well as Australian, British and US firms. With Nigeria’s ban on the export of raw lithium ore, Chinese investment in processing plants alone has hit $1.3 billion.

The independent non-profit Natural Resources Governance Institute (NGRI) warns that although Nigeria’s mineral sector provides a real opportunity for economic diversification, it is not a quick fix, and realising its potential requires realistic expectations and effective governance mechanisms.

“Stronger community engagement, environmental management, grievance mechanisms and transparency are essential to attract responsible investment, maintain public trust, and ensure mining delivers sustainable and inclusive development,” the NGRI said in a report released earlier this year.

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Although Nigeria’s mining law sets clear provisions for community and environmental protection, regulatory oversight is weak. “Resources and capacity are never enough,” Olasehinde Oladusi, deputy director in the Ministry of Solid Minerals and Development, told The New Humanitarian/PREMIUM TIMES.

In mineral-rich Niger State, the country’s largest by land mass, the department has only one vehicle and a total of four staff in its Mines Inspectorate Department (MID) – supposed to supervise all day-to-day operations – and its Mines Environmental Compliance Department (MEC).

On paper, mining and processing companies are supposed to win the approval of local communities before they begin work, which typically involves a Community Development Agreement (CDA) approved by the MEC, which outlines the compensation to be provided. CDAs are typically in the form of community infrastructure investments – from roads to water to education grants.

But lopsided power relationships can disenfranchise communities. Kangimi is 40 kilometres from the north-central city of Kaduna, where one of Nigeria’s first lithium processing plants has been built – a joint venture between a Chinese company, Ming Xin Mineral Separation Nigeria Ltd, and the state government.

Borehole water was promised, solar lighting, roads, a clinic, and jobs. But three years on, village head Danjuma Husseini said the cheap plastic taps for the water system broke, the solar is underpowered, the clinic and roads are yet to materialise, and village youth are only employed informally.

Village elders didn’t hire a lawyer when drawing up the CDA, and do not have a copy of the original agreement.

“We weren’t used to such things,” Mr Husseini explained. “Also there’s no cyber café nearby to make a copy: It was our fault, but we’re learning – next time we will make sure to have a copy.”

When New Humanitarian/PREMIUM TIMES last visited Kangimi in September, negotiations were underway with the company’s representatives for the building of a new mosque for the village. “But we still don’t really trust them,” Mr Husseini said.

Part of his unease relates to the potential pollution from run-off from the processing plant, which enters a purpose-built dam next to the reservoir that provides Kaduna with some of its drinking water and Kangimi fishers with a livelihood. The mud-built dam wall, about one metre high, is broken in a corner that allows seepage into the reservoir – and many months on, it is not yet fixed.

The reservoir water is treated, and there is no evidence of contamination, Kaduna State authorities note. But Sunday Duniya, the water treatment manager, acknowledged that they occasionally run out of the necessary chemicals – and the water supply then has to be shut off: “We can’t serve untreated water,” he insisted.
Yet he noted that the cracked dam wall so close to the reservoir was “absolutely wrong”, and was a matter for Kaduna State’s Environmental Protection Agency – which refused to comment for this story.

Criminalising the informal sector

Nigeria’s mining sector is overwhelmingly informal. Rural communities supplement farming incomes with the money they make under the earth during the dry season wielding picks and shovels.

Dangoma village, in southern Kaduna State, is a landscape of circular pits across mica-strewn ground, each owned by an individual miner. From the roughly five-metre-deep central shafts, they dig horizontal tunnels underground. The miners can’t go deeper as they lack wood to shore up the shafts and fear pit collapses.

Out of school hours, children are also on the site, young girls picking through the white mica on the surface and dropping it into baskets, and the braver boys going underground – some as young as 10. The lithium and mica collected are sold to middlemen in Dangoma who sell on to larger traders that visit intermittently.

People have been digging in Dangoma for the past five years. The origin story was that two brothers from the village had moved to neighbouring Plateau State as miners, and realised the geology was the same. It has become a financial lifeline for many families.

“This area is agriculturally rich, but you need capital to farm – and you don’t make your money until the harvest,” said miner Abdul Oma. “But with mining, you make your money the instant that you dig – if you’re lucky.”

There is a tendency to criminalise the informal sector. In September, 37 boys and young men died in the custody of the Nigeria Security and Civil Defence Corps in Niger State after they were arrested in raids on mining sites and packed into a severely overcrowded and poorly ventilated cell.

READ ALSO: Nigeria’s lithium, copper reserves key to clean energy transition – Report

However, the process of registration to operate legally is complex and centralised. Miners first need to form registered mining cooperatives before they can apply for a license, which, although relatively cheap, requires navigating an online platform and payment system, as well as additional certification – a level of digital savvy beyond most rural miners.

Miners are therefore effectively forced to operate informally, and their criminalisation makes them vulnerable to exploitation by so-called “bandits” – the criminal gangs that hold sway in much of Nigeria’s hinterlands.

“Bandits don’t do mining themselves, but they hide in the unregulated sector,” noted Mr Oladusi. “They create insecurity, they create panic, and are entrenched.” The ore they extort enters the value chain through middlemen or direct sales to established licensed mines, and is then processed alongside legitimate lithium.

Birnin Gwari, on Kaduna’s northern border with Zamfara and Katsina states, and Niger to the west, is a case in point. The New Humanitarian/PREMIUM TIMES interviewed four informal miners who all described how bandits preyed on them, stealing their lithium ore or forcing them to work for them.

“We fear the bandits: They come to where people are mining and enslave us to mine for them,” said one man in a Liverpool football shirt who asked not to be named. “They can come at any time – you can’t predict.”

He was among a group of six people kidnapped last year from his village and held for 18 days until his family could scrape together the few hundred dollars demanded in ransom.

Although the state government has reopened the highway to Birnin Gwari – and a police escort is no longer needed to travel the previously hazardous route – a bandit economy linked to resource extraction, based on exploitation and violence, prevails in the countryside.

“There is no government presence; the bandits are the government,” said one of the miners. “Although there is a security presence along the highways, we feel somewhat protected; inside the villages, there’s nothing.”

Nigeria is in a rush to maximise the benefits of its mineral wealth, but developing a coherent mining sector takes time. “The gestation period for mining is long term,” Dauda Garuba, the director for Center for Democracy and Development (CDD), told The New Humanitarian/PREMIUM TIMES. “You don’t just turn up, take the ore, and then move.”

Mining projects are often located in remote areas which need investment in transport and power infrastructure. Although a cornerstone of government policy, “value addition” – the local processing of lithium – also requires the right mix of tax, policy incentives, and demand, noted the NGRI report.

Pointing to the loopholes in the mining law and government guidelines, Mr Garuba offered a cautious assessment: “I don’t think that what we’ve done so far is comprehensive enough to really take us to the next level that we want to achieve [in mining development],” he added.

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