Africa Finance Corporation and the Federal Government of Nigeria have signed a deal to invest in three major mining projects. One of them includes USD 1.3 billion for an aluminium refinery project. This agreement was signed under the Solid Mineral Development Fund (SMDF), a sovereign investment fund designed to catalyse private sector-based growth in the mining industry. 

Under this agreement, both parties will carry out a geoscience mapping programme to improve mineral data and reduce exploration risks, encouraging more investors to participate in the sector. They will also create a joint investment vehicle to speed up exploration and mining development in Nigeria. The aim is to promote faster exploration, development, and eventual production from approved mining leases, particularly after successful exploration campaigns.

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Segun Tomori, media aide to the minister of solid minerals development, said the refinery will use the Bayer process, a widely applied method for refining alumina from bauxite. The plant will also include a gas-fired system to generate steam and electricity for its operations. The proposed refinery is expected to process about one million tonnes of bauxite each year. 

He stated, “The facility is designed to operate for approximately 20 years at 95 per cent utilisation, with total alumina output projected at 19 million tonnes over its lifespan.”

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Dele Alake, minister of solid minerals development, described the agreement as a landmark development for the country’s mining industry, with potential contributions to the GDP of Nigeria. He stated that the project aligns with the ministry’s broader reform agenda, which aims to modernise regulations, improve transparency, and strengthen the mineral licensing framework. According to him, these reforms have started attracting significant private-sector investment into the sector. He also confirmed that all required government approvals have been granted to facilitate swift implementation.

The Executive Secretary of SMDF, Fatima Shinkafi, noted that this is the largest capital investment project undertaken by the fund since its establishment. She described the agreement as a major milestone, reflecting the growing institutional capacity of the SMDF to support large-scale industrial projects.

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This project is expected to become the largest private investment project in Nigeria’s mining sector. USD 1.2 billion contribution to the nation’s GDP is projected by the ministry. Over the full operational period of the project, there is a potential to add more than USD 25 billion to the national economy, and more than USD 8 billion in foreign exchange.

Pre-feasibility studies for the agreement were carried out by the AFC and the SMDF, which confirmed that the refinery is commercially viable and competitive. The findings support the broader goal of positioning Nigeria as an attractive and globally competitive destination for mineral investment.

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The agreement was signed by Fatima Shinkafi for SMDF and the deputy director of metals and mining, Franklin Edochie, for AFC, with Samaila Zubairu, the president and chief executive officer of AFC, present at the ceremony.

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