Nigeria has successfully completed its first commercial sale of raw gold on the London Bullion Market, marking a significant achievement for the country’s mining sector. Dele Alake, Nigeria’s Minister of Solid Minerals Development, announced the milestone on Sunday, detailing how this transaction has contributed an additional $5 million to the nation’s foreign reserves.
As part of the deal, over 70 kilograms of gold were refined to the London Bullion Market Good Delivery Standard, a prestigious benchmark recognized globally for gold trade. This also led to the aggregation of locally sourced gold, primarily from artisanal and small-scale miners, contributing about N6 billion to the local rural economy.
Alake shared these details while presenting a symbolic gold bar to President Bola Tinubu over the weekend. The gold was sourced through the Solid Minerals Development Fund, which works to support and regulate the mining industry. According to a statement from Alake’s media assistant, Segun Tomori, the refined gold is set to be sold to the Central Bank of Nigeria (CBN), further boosting the country’s foreign reserves.
Nigeria’s gold reserves are estimated at about 600,000 tonnes, valued at approximately $45 billion, with significant deposits in states like Zamfara and Edo. However, the rampant issue of illegal mining has undermined the nation’s potential, with much of the gold being diverted into private hands, leaving government resources scarce. This issue led former President Muhammadu Buhari to declare Zamfara State a ‘no-fly zone’ to curb illegal gold mining activities.
At the ceremony, Alake praised President Tinubu for his consistent support of reforms in Nigeria’s mining and solid minerals sector. He expressed confidence that the National Gold Purchase Programme (NGPP) would strengthen Nigeria’s foreign reserves and help stabilize the country’s currency, the Naira.
Alake explained that the successful completion of this gold transaction was a major indicator of the NGPP’s potential, which operates as a centralized offtake scheme to aggregate gold from decentralized networks of miners and cooperatives. He emphasized that the programme has shown the feasibility of using Naira to purchase gold, a US dollar-denominated asset, to build fiscal and monetary stability in Nigeria.
President Tinubu, upon receiving the symbolic gold bar, commended the Solid Minerals Ministry for this achievement, highlighting it as a key step towards economic diversification under the administration’s Renewed Hope Agenda.
During the presentation, Fatimah Shinkafi, Executive Secretary of the Solid Minerals Development Fund, further elaborated on the London Bullion Market Good Delivery Standard, which sets the bar for quality in global gold trading. She noted that only gold and silver bars that meet this standard are accepted for settlement in Loco London contracts, which involve bullion physically held in London.
Through the National Gold Purchase Programme, Nigeria has joined a select group of countries that use their local currency to acquire gold, a strategy designed to boost economic confidence, enhance currency stability, and create a more favorable environment for foreign investment. This innovative approach is expected to help transform Nigeria’s gold sector into a cornerstone of economic growth and sustainability.
