The Ministry of Solid Minerals Development has opposed a senate bill seeking to establish a Bitumen Development Commission to regulate the exploration of bitumen in Nigeria. The Ministry argues that the bill is unnecessary, inconsistent with global best practices, and would exacerbate the already high cost of governance.

Sponsored by Senator Jimoh Ibrahim, representing Ondo South, the Bill, which has already passed its second reading in the Senate aims to position bitumen as an alternative revenue source for Nigeria, which holds over 38 billion barrels of bitumen reserves—the second-largest deposit in the world after Canada.

During a public hearing organized by the Senate Committee on Solid Minerals Development, Dele Alake, the Minister of Solid Minerals Development, suggested that rather than creating a new agency, efforts should be concentrated on strengthening the existing capacity of the Ministry and its departments already regulating Bitumen.

He emphasized the need for adequate budgetary allocation to enable these bodies to effectively discharge their functions.

“Establishing a commission solely for bitumen, out of over 44 mineral types, does not align with global best practices,” Alake stated. “It would increase the financial burden on the cost of governance, which is already overly bloated.”

The minister expressed concern that creating a commission to regulate a single mineral could set a challenging precedent, leading other regions to demand similar commissions for their local minerals.

He also noted that the ministry, in collaboration with the National Assembly, is already working on a bill to establish the Nigeria Solid Minerals Corporation, which would oversee the development of priority minerals such as gold, limestone, and iron ore, including bitumen.

Alake further highlighted that a federal committee is currently focused on developing Nigeria’s bitumen resources, making an additional commission redundant.

Ibrahim, sponsor of the bill, during the public hearing however noted that the global Bitumen market is huge, valued at at $110 billion, and projected to reach $146.59 billion by 2030 at a compound annual growth rate (CAGR) of 4%

He lamented that despite having the world’s second-largest bitumen deposits; Nigeria has not harnessed its potential for revenue generation, job creation, and economic diversification.

Ibrahim stressed that the absence of specific legislation to regulate bitumen exploration is the primary reason Nigeria has not benefited from this resource, which his bill aims to address. (BusinessDay)