Executive Interviews

Asia Metals: Hi, Mr. Umar, thanks for accepting this interview. Firstly, could you please give us a brief induction about your company’s main business and production?

Mr. Umar: Hello! Thank you for the opportunity to do this interview. A2 Mega Resources Limited is a registered company incorporated in 2010 under the laws of the Federal Republic of Nigeria, to carry on the business of mining and trading of minerals amongst other businesses in collaboration with Sky Digital Mineral Limited. We have been into the production of mainly gemstones and mineral metal (Lead, Zinc and Tantalite).

Asia Metals: How about the production capacity of zinc ore and lead ore presently? What about the target in 2024?

Mr. Umar: We have personal mining concession of Lead and Zinc in Alkaleri, Bauchi State, and other locations in Wase and Abakaliki, Plateau and Ebonyi State respectively which is in collaboration with our partners. Our production back in the days was up to 1,500MT monthly, but gradually decline due to the rush to the exploration and mining of lithium which diverted many miners across Africa due to its high demand. However, last few months we were producing 300MT monthly which we are hoping to increase between 500 to 1,000MT/month within the next few months. The target output in 2024 would reach about 18,000MT.

Asia Metals: How about the zinc and lead ore quality in Nigeria? What grade is your zinc and lead ore at?

Mr. Umar: The Lead and Zinc industry is one of the main players and challengers in the Nigeria mining sector due to its abundance and grade, it is considered one of the highest grade lead in the world, it comes with other high value mineral concentrates like silver and the lead concentrate is up to 80%. The Nigeria zinc also comes in good grades ranging from 30% to 55%. We can produce zinc ore 40%min and lead ore 50-55%min.

Asia Metals: What is your idea on Lead and Zinc ore cost in Nigeria? Would the cost decrease in 2024?

Mr. Umar: Currently Lead ore costs about USD1,021/dt, while Zinc ore costs USD680/dt. Due to the present economy situation, inflation and fuel subsidy removal which hike the cost of almost everything in Nigeria also impacts on the production of lead and zinc ores which makes the price to go high.

Asia Metals: What is the current export price of Zinc and lead ore? What is your outlook for the zinc and lead ore demand and the Prices in 2024?

Mr. Umar: We have seen prices going up in the export market currently up to USD1430/dt FOB of higher grade of lead ore 65%min,and meanwhile, zinc concentrate 35-45% is sold at USD900/dt FOB. The demand for lead and zinc ore will continue to increase same with the price in 2024.

Asia Metals: Is there any export duty in Nigeria?

Mr. Umar: As an exporter of any mineral from Nigeria, you must pay for royalty (3% of the value) and export clearance (onetime payment for shipment which is not more than USD100) to the Ministry of Mines and Steel Development (MMSD) before commencing any export. This is inline with the Mineral and Mining act.

Asia Metals: How do you anticipate the production of Nigeria’s Lead and Zinc Ore in 2024?

Mr. Umar: 2024 is going to be a robust year in the lead and zinc mining industry due to all the newly introduced mining policies.And with the decline of the lithium price and demand, many other miners with lead and zinc titles will move back to their site and start production considering the present high demand of lead and zinc. With these factors, the production in 2024 will surpass that of 2023 with large figure.

Asia Metals: What are the challenges Nigeria Lead and Zinc ore Industry facing?

Mr. Umar: Like any other mineral in the mining sector, the Nigeria lead and zinc industry needs more development in terms of establishing refining plant for the lead and zinc in order to be exporting refined zinc and lead ore which will reduce freight cost and increase the value. More exploration for reserves and quantification is needed for the industry. The Nigeria Ministry of Mines and Steel Development are presently initiating the ban on unrefined mineral resources out of the country. If this policy is implemented, it’s going to cause lots of distress and challenges to some miner who are not prepared.

Asia Metals: What are the main areas of your current market? Which areas will you focus on in 2024？

Mr. Umar: At the moment, we are selling mainly in the local market and we are working on selling internationally. We hope to find more customers through Asian Metal.

Many African companies fail to meet up to contract given to them to supply minerals due to lack of cash and technical know-how. The biggest challenges for our company is that Turkey bank account through T/T without any issue. Having these entire in place will aid in the increase in the production of these minerals also be able to meet up with orders and contracts as agreed. We want to go into business relationship with major importers and end users of these minerals (Lead and Zinc). We also want to invest in to processing of these minerals to improve the quality and reduce the waste and cost of freight. That way, we will be able to serve our customers with the highest grade at more affordable price below other miners and suppliers of these same commodities.

It's important to note that specific areas of focus in 2024 will depend on various factors such as market trends, government policies, emerging technologies, and global economic conditions. Industries and markets are constantly evolving, so it's crucial for businesses to stay informed and adapt to changing circumstances. Despite all these factors, Asia’s downstream sector will take the lead.

Asia Metals: How about your ideas of different downstream markets like Europe, Asia and America?

Mr. Umar: Europe has a diverse set of downstreammarkets across various industries. Some key sectors include automotive,aerospace, pharmaceuticals, chemicals, and consumer goods. European countriesare known for their strong manufacturing capabilities and advanced technology.All these sectors demand refined lead and zinc to raw materials for themanufactures. But due to the current chaos and tension caused by the warbetween Russia and Ukraine, this makes Russian market not to be an ideal zonefor international trade.

Asia is vast and rapidly developing region with awide range of downstream market and demands for various minerals. It is home tomajor manufacturing hubs and emerging economies. Key sectors in Asia includeelectronics, automotive, renewable energy and telecommunications. Having Chinaat the forefront with a very strong economy and will to invest in developingthe mining sector in Africa, there is no doubt that it’s going to be largestimporter and processor of these minerals and be the supplier of the refinedminerals to the other continents downstream sectors.

The American downstream market is highly diverse due to the size and economic strength of the region. The United States leads in several industries, including technology, aerospace, pharmaceuticals and renewable energy. This places the American continent as the largest because of its application of lead and zinc in its downstream sector of refined mineral used for the manufactures.

Asia Metals: Thanks again for your wonderful sharing, and we wish your company a prosperous business.

Mr. Umar: Thank you.