Cost and Technical Requirements for starting/operating a small scale gemstone Mine
Nigeria is a blessed a country with a lot of minerals most especially solid minerals like Gemstone e.g Gold, Diamond, Ruby, Tourmaline, Sapphire and more
To start with, Artisanal and Small-Scale Mining (ASM) are formal or informal operations with predominantly simplified forms of exploration, extraction, processing and transportation. ... While ASM can provide a mean to generate income to get out of poverty, it can also be a way to trap miners and the families in poverty.
Briefly, on the mineral we are about to get is technical requirement and cost for mining the mineral.
Gemstone is a piece of mineral with special properties like colour, hardness among others which makes it different from other earth forming Mineral.
This mineral is such that after it has been cut and polished is made into a piece of jewelry or another accessory
FORMATION OF GEMSTONES
Gemstones are of substantial monetary value for its beauty or shine, which are form from the eruption of molten magma to the surface, due to slow cooling, temperature and pressure.
Examples of this mineral are
1. Tourmaline which semi-precious stone
2. Ruby
3. Gold a precious stone
4. Diamond
5. Sapphire
6. Emerald
1. Colour: all gemstones are of specific colour which varies from lighter-darker, more or less vivid
2. Cut: this refer to the shape or design of the stones e.g stone or bottle shape, tourmaline is of bottle shape, quart is hexagonal in shape e.t.c
3. Carat weight: gemstone is measured by its weight not by its dimension and one carat is approximate to 0.2 gram
4. Hardness
GEMSTONE MINING AND PROSPECTING METHOD
OPEN CAST MINING METHOD
Gemstone is a solid mineral which is mostly been mine on the surface of the earth using open cast mining method with the depth less than 320m. Open cast mining method is a class under surface mining method. It use for the extraction of shallow depth deposit, those with shallow overburden thickness.
PROSPECTING METHOD
1. Sluicing: channel of running water, and wash scoops of ore and dirt with a framed screen so that only stones are left.
2. Creeking/Panning
Mountain mining operations may have creeks flowing through the terrain that are available for prospecting. The creeks will be up to knee-deep and can contain gems that have been deposited in the waters from surrounding mines through erosion.
Some people like to look for gems by peering at the exposed gravel and rock. Screening, or panning, is more common and more productive. To pan, you need a hand shovel and a screen, which is some type of metal grid enclosed in a frame. Screening is similar to straining things in the kitchen: dump a shovelful of gravel on the screen and strain with the available water.
Digging
To dig for gems is to cut into the ground or in a mine's vein, hoping to find a mother lode that yields a valuable find. This kind of prospecting is real labor and requires a rock hammer, shovel and bucket. Mining operations will usually supply them for a fee. Equipment you bring from home might have to be approved before you can use it.
Before you can start mining your gemstone legally, you have to acquire some license and lease, you have to know the equipment to use and there prices this will tell you the amount you need to start your operation known as CAPITAL
THE TYPE OF LICENSE TO ACQUIRE AND HOW TO OBTAIN THEM WITH THERE COST
There are major types of mining leases or licenses or permit in Nigeria, which are commonly applicable in the Nigerian mining sector they are as follows
Reconnaissance Permit
Exploration Licence
Small Scale Mining Lease
Exploration License
Possess or Purchase License
Water Use Permit
Export License
The functions and requirements for all of the above listed licenses can be summarized as follows:
Exploration License: Exploration license is granted to any individual company that intends to prospect for mineral resources in Nigeria. This type of license allows the licensee to search for the required mineral resources deposited in the areas covered by the license.
Mining Lease: A mining lease in Nigeria is granted to any company that intends to start mining of mineral resources in commercial quantity in Nigeria. This type of license proceeded by an exploration license. A company seeking to obtain a mining lease must have found or located mineral resources satisfactory quantities making application for the lease.
The major requirements for obtainment or grant of mining lease are as follows:
Certified true copy of Incorporation documents
Completed application forms
Pre-Feasibility Report
Prospecting plan
Payment of processing fee
Evidence of financial capability or banker reference letter
Evidence of technical competence or COMEG accredited geologist
Irrevocable consent from land owner(s) and/or occupier(s) to the applicant
Attestation of non-conviction of criminal offences under the Act by a Lawyer
Under the Nigerias Minerals and Mining Act, 2007, only corporations can obtain a mining lease in Nigeria. And when a mining lease is issued, the duration is for a period of 25 years.
Small Scale Mining Lease: The Small Scale Mining Lease, as the name appears, is a smaller version of mining license. The procedure for obtainment of the SSML is a little bit similar to that of Mining Lease, with some distinctions. When SSML is issued, the duration is for 5 years. However, an SSML can be converted to proper Mining License if the scale of production or usage of it exceeds the criteria stipulated for SSML.
Possess or Purchase License: The Possess or purchase license is a mining license in Nigeria, which is required from any entity seeking to trade in mineral resources. Under the Nigerian Mineral laws and regulations, it is an offence to possess or to be moving mineral resources from one place to another without the requisite license. Possess and Purchase creates an avenue for any corporation that does not own or possess a mining lease to directly engage in mineral trading or exporting.
Some of the requirements to obtain a Possess and Purchase License are as follows:
Certificate of Incorporation of the Company, including CAC Form 1.1
Application letter
Tax Clearance
Attestation of non-conviction for a criminal offence by a Legal Practitioner
Bankers Reference Letter
Letter of consent from a Mineral title holder
Evidence of technically competent person (credentials of Mining Engineer)
Payment of prescribed fee
The duration of the license is one-year subject renewal.
Possess or Purchase License
Mineral Buying Center License
Export License
REQUIREMENTS FOR OBTAINING A MINING LICENSE IN NIGERIA
Before going into the steps involved in applying for a mining lease in Nigeria, it is important to identify the various requirements for each stage of the process. The requirements for a mining lease and a small scale mining lease are the same, they are:
Pre grant conditions:
The following documents are to be submitted with the duly completed application forms
Pre-Feasibility Report with COMEG seal and signature
Prospecting plan / reserve estimation
Extant Exploration license
Evidence of financial capability
Evidence of technical competence
Irrevocable consent from land owners or occupiers.
Attestation of non-conviction of criminal offences under the Act
Evidence of payment of processing fee
Certified true copy of certificate of incorporation
Minerals to be exploited Survey plan of specified area to be submitted
13. Notice to land owners (private or state land) with a response on rate to be paid
2. Pre-Development conditions (post-grant)
1. Environmental Impact Assessment (EIA)
2. Community Development Agreement (CDA) copy to be Submitted to MCO and all relevant departments in the Ministry
3. Compensation (section 107)
4. Mine Closure plan/Rehabilitation plan
5. Reports from state bodies/ MIREMCO
APPLICATION FEES
SERVICES FOR
MINING LEASE ML AND
SMALL MINING LEASE SSML
Application Processing fees
N50,000 (ML)
N10,000 (SSML)
Annual Service Fee
N25,000 (ML)
N10,000 (SSML)
Renewal Fee
N250,000 (ML)
N30,000 (SSML)
Late Renewal
N100,000
N100,000
Equipment & machine use and there price
Pneumatic jackhammer: 185,000Naira
Hydraulic air compressors (Indersol rand XP800):4,500,000Naira
Backhoe excavator:37,000,000Naira or
to rent #120,000/day
Carbide-Tipped Hand Points & Chisels...... #700 each
Washing plant shaking table (1tn/hr)........ Old 417,700Naira
new 1,020,000($3,000)Naira
Pumping machine for dewatery action in case......... 45,000Naira
Another option for mining can be MANUAL MINING option which require less amount than the above mining option. This mining method comprises of less equipment as follow:
1. Air Compressor
2. pneumatic jackhammer : jackhammer is been employ in this operation because most of Gemstones like Tourmaline can be found in a vault zone where their casing is very hard in layer ordinarily, hammer and chisel can not be use to remove the hard layering this case we have to employ the use of jackhamer
3.clearing of overburdened with the use of back hole excavator by renting form other company at the rate of #100,000 to #120,000 per day
4. Digger, shovel, hammer, carbide tipped head chisel, head pan
In short for
5. Alot of human labour is required
6. Pumping machine and generator to power them,
Washing plant is not listed among because this is done by the unskilled workers to wash the minerals in an alternative way instead of using washing machine
Personnel Requirements
Drillers 2
Blasters 1. #50,000
Excavator Operators 1
Equipment Operators 1
Mechanics 1
Laborers/Maintenance 30,000 to #40,000
Personnel 32
Salaried Personnel Requirements
Manager 1
Engineer 1 100,000
Geologist 1
Supervisor 3
Accountant 0
Personnel 0
Secretary 1
Security 1
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Total Salaried Personnel 8
Primary Supply Requirements
Diesel Fuel liter/day
Powders #not consistent in buying per day
Caps
Primers
Drill Bits
Det. Cord m/
Cost Summary
Operating Costs
Capital Costs
Equipment Purchase #43,000,000 (new equipment). #6,000,000 (for old and equipment rent) .
Pre-production Stripping #700,00
Contingency plan # 5,000,000 to convert to manual mining
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Total Capital Costs
Article compile by: staycool
Contact:+2347068892427
