Economic Diversification, the Energy Transition and Mineral Opportunities in Nigeria

Report
20 August 2026

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Key messages

Nigeria’s mineral sector offers a real opportunity to support economic diversification and the country’s energy transition, but it should not be treated as a quick substitute for oil and gas revenues. Realizing its potential will require realistic expectations, careful sequencing and strong governance.
An immediate priority is to reduce investor risk and strengthen state capability. This requires accessible, credible geological data integrated with the cadastre; regulatory certainty, including through clearer federal–state roles; focused national mining companies that de-risk rather than replace private investment; and action to address insecurity and improve artisanal and small-scale mining governance.
Aligning mining with infrastructure, energy and industrial planning should also be an early priority. This can help unlock scale, strengthen competitiveness and maximize broader economic benefits.
Domestic value creation will require combining a competitive fiscal regime with effective management of revenues, phased supplier development and targeted support for viable, beneficial value chains once capabilities and opportunities are clearly understood, while leveraging regional cooperation to maximize benefits.
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.

Nigeria has a real opportunity to use its mineral sector to support economic diversification and the country’s energy transition. Rising demand for minerals linked to clean energy technologies, digitalization and defense, combined with Nigeria’s geological potential, could help increase exports, generate public revenues, create jobs and support related industries. The government has recognized this opportunity through a new sector roadmap, legal and fiscal reforms, the establishment of the Nigeria Solid Minerals Company and new international partnerships.

But this opportunity should be approached with realistic expectations. Mining can support diversification over time, but it should not be treated as a quick substitute for the foreign exchange earnings, public revenues or employment associated with oil and gas. Mining projects are capital intensive, volatile and slow to develop. They often generate lower rents than oil and gas and create fewer direct jobs than many policymakers expect. Nigeria’s mineral sector also remains small, with low exploration spending, a relatively narrow investor base, infrastructure constraints, insecurity in several mineral-rich states and widespread artisanal and small-scale mining.

In this report, we examine recent policy developments and identify priority next steps for the government across four key areas:

Mineral resource readiness
Domestic value creation and industrialization
Social license, environmental stewardship and sustainability
Policy foundations

Not all reforms should be pursued at the same time. Given limited state capacity, fiscal constraints, the nascent nature of the sector and the need to maintain investor confidence, the government should sequence reforms carefully. By advancing the sector selectively, competitively and responsibly, the government can ensure Nigeria’s mineral opportunity translates into sustainable development.