Surging market demand triggers lithium boom in Nigeria

By Adewale Sanyaolu

The federal government’s economic diversification efforts are gaining traction as a wave of approved artisanal miners and foreign investors pour into Nigeria’s lithium sector.

With the soaring global demand for lithium, fueled largely by the electric vehicle battery industry, Nigeria is fast emerging as a key player in the rapidly expanding market.

With global lithium demand projected to surge fortyfold by 2040, Nigeria is positioning itself to harness the industry’s full economic potential. However, the country faces critical challenges, including the need to establish local processing facilities and formalize mining activities to ensure sustainable growth and value addition.

Daily Sun recently reported moves by United States President, Donald Trump, to be be setting his sights on Nigeria’s burgeoning lithium industry, a sector increasingly recognised as a cornerstone of the global energy transition.

Despite his historically indifferent stance on trade with Africa, Trump’s potential interest in Nigeria’s lithium reserves suggests a strategic recalibration driven by the surging global demand for critical minerals.

Lithium, a key component in electric vehicle batteries, renewable energy storage and advanced technology, has become a geopolitical asset, with major economies scrambling to secure stable supply chains.

However, recent executive orders signed by Trump have notably excluded Africa from his list of trade priorities, raising questions about the seriousness of any prospective engagement. While China continues to dominate the global lithium market, the U.S. has been seeking alternative sources to reduce dependency, and Nigeria, home to some of the world’s richest lithium deposits, presents an attractive prospect.

Renowned political economist, Professor Carl LeVan, equally expressed worry over the omission of the Africa Growth and Opportunity Act, AGOA in Trump’s “America First” agenda.

Nigeria’s lithium development will largely depend on the government’s ability to regulate the sector, attract new investors, and secure mining zones. Current dynamics indicate a growing interest in this strategic mineral, presenting substantial economic opportunities for the country and its industrial stakeholders.

Nasarawa state has emerged as a focal point in the industry’s latest developments, solidifying its position as a key hub for lithium mining, thanks to its abundant reserves.

The Minister of Solid Minerals Development, Mr. Dele Alake, emphasised the significance of Nasarawa state in advancing the nation’s mining sector.

He spoke while receiving Abdullahi Sule, Nasarawa state Governor, and Abubakar Badaru, Minister of Defence, in his office recently.

In a statement on Sunday, the Minister’s Special Assistant on Media, Segun Tomori, quoted Alake to have affirmed that Nasarawa has been a formidable partner in harnessing the state’s vast minerals potential for national development.

“Lithium, for instance, is quite massive in Nasarawa state,” Alake said.

“It is like an epicentre of mining in Nigeria, which is why it is important for us to always discuss with the governor and collaborate with him to scale up mining activities in the state.

“I have received very warm and robust cooperation from him and the minister of defence, all centered around the development of our solid minerals in Nigeria.”

The governor said the reforms and initiatives to boost the mining sector over the past 17 months are yielding results, as global investors are showing growing interest in Nigeria’s mining industry.

In his remarks, the Nasarawa state governor praised Alake for successfully advancing President Bola Tinubu’s mining development agenda.

Also, Sule noted that challenges like insecurity remain in some areas, underscoring the need for continued collaboration with Alake and the minister of defence.

“The purpose of this meeting is to work together and find solutions to security challenges, so that mining operations can go on, unhindered,” the governor said.

Sule added that lithium factories in the state are operating at full capacity, with more factories under construction, emphasising the need for continued collaboration with the private sector to enhance the state’s mining value chain.

Also speaking during the meeting, the minister of defence reaffirmed the federal government’s dedication to eliminating banditry and other criminal activities across the country, adding that ongoing efforts have already facilitated the resumption of mining exploration in Zamfara.

“The bandits are already on the run. The military will not rest until the country is fully secured,” he said.

“The President has given us a clear directive to end insecurity in all parts of the country by the end of the year.

Badaru said the national security adviser (NSA), the chief of defence staff, and his team are working round the clock to actualise the target.

In contrast to artisanal mining, Chinese companies such as Avatar and Ganfeng have invested in local processing facilities. These companies convert raw rock into lithium oxide before shipping it to China, which remains the world’s leading lithium refiner. Chinese involvement in the sector continues to grow, despite the Nigerian government’s efforts to attract other investors.

A memorandum of understanding (MoU) signed in late 2024 between Nigeria and France aims to develop mining projects, including lithium extraction. However, foreign investments remain largely limited to Chinese firms. The Nigerian government has introduced a requirement for foreign investors to build local processing units, a condition that reportedly discouraged some major industry players, including Tesla.

Nigeria’s mining sector is still developing its regulatory framework. Authorities frequently crack down on illegal mining operations, yet they persist due to the high demand and lack of oversight. The absence of precise data on mineral reserves and the lack of comprehensive geological studies further hinder market structuring.