The first industrial gold production is taking off in Nigeria by the first quarter of 2021. A $98 million gold refinery under construction by Thor Exploration Limited is near completion, Olamilekan Adegbite, Minister of Mines and Steel said on Friday in Abuja.
It will be the first industrial gold project in Nigeria and will go into operation next year, the minister told reporters. Gold production in Nigeria has been left to illegal miners who using crude means to exploit it.
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Previous administrations in the country have promised to make mining’s role feasible in the economy since 1999. Over a decade ago, legislation to expand the sector, but never happened. Adegbite noted that the success of the project will prompt mining in Nigeria where there is a large gold residue.
According to the minister, attracting other gold mining companies to Nigeria will depend on the progress and success of Thor. Their success will be crucial in boosting gold production in Nigeria.
Thor Explorations Ltd. is investing $98 million into the project, with the expectation of 80,000 ounces output annually. By the first quarter of 2021, the mine should yield gold, Adegbite said.
Thor Explorations Ltd is a Canada-based company’s who operate Segilola mine in the southwest. According to Adegbite, Thor is “the proverbial company that dares to jump in the shark-infested water and see whether it survives”.
Thor Explorations Ltd is receiving a $86 million debt-equity financing package from Lagos-based Africa Finance Corporation (AFC) as back up for the project.
Nigeria houses sizable untapped deposits of metals including iron ore, gold, zinc and lead. Small-scale and manual extractions have lingered in gold mining in Nigeria. With less than a 0.1% contribution to the GDP, the government is looking to make up to 3% more from mining by 2025.
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