Despite the high financial and physical risks associated with investments and workforce in the Nigerian mining sector, Kian Smith Trading Company has embraced large scale investment in the sector. In this interview, Chief Executive of the company, Nere Teriba, discusses the strategies, challenges and advantages of trading in solid minerals in an undiversified economy where oil and gas are regarded as superior commodities for trade. Francis Kadiri reports.
The Nigerian mining sector is characterised by financial and physical risks, the fear for which banks have refused to finance any investment blueprint in the sector. How did Kian Smith start?
To be honest with you, we are just very fortunate on our success in the sector. It was a coincidence because it was not initially intended, but it has finally paid off.
How did it start and how was it a coincidence?
I studied Electrical and Computer Engineering and had no plans for mining. One day I was thinking of where to look and mining came to mind, so I did some research and started studying about the sector. I made enquiries and met some people who are well known in the sector.
Chief Aderinokun was the first person I met but he discouraged me, saying; “don’t go into mining business,” but I didn’t listen. I am happy that these days, we have met and he is proud of me and would now say; “you didn’t listen to me, but I am happy you are succeeding.” Chief Aderinokun and Segilola continued to advise me and my successes improved.
Even after making up my mind, I didn’t know how to join the trade. It was difficult to start a business that I didn’t understand, so I entered through trading of solid minerals and by organising traders. I am very indebted to God for giving me the volume of success I am now known for, and I am also grateful to all those who continued to advise me.
Mining is dominated by men and, as a woman, how did you manage to cope?
I don’t think of the woman thing, I just do my work because I don’t believe that being a woman is a shortcoming if I needed to begin any trade. In all my classes and from youth, I interacted with the male. I was the only woman on my team when I worked as a computer engineer and so I find no problem being a miner and gold trader.
I agree that there are a few instances where being a woman could be detrimental. For example, there were occasions when my orgainsation had to meet with host communities and I didn’t show up. I delegated male directors because some cultures may be uncomfortable with realising that a woman is in charge.
What are your growth targets for the next two years?
We are looking at developing the gold economy of Nigeria. We want Nigeria to develop her gold resources and join the trading rank of Dubai and Mumbai. A lot has to be done on that front, especially in the development of policies. The policy has to address the challenges of orgainisation and even the problems associated with investments in the sector.
We expect that Nigeria can utilise its natural resources, especially gold, to become a billion dollar economy in the near future…and Kian Smith is doing its part. Kian Smith has a hand in developing Nigeria’s gold mining and trading business to the status of a billion dollar economy. The many hands involved can grow their businesses in the interest of developing the economy. However, a lot of things have to be done to make it possible for us.
We have a targeted volume of trade that we hope to hit within the next two years. We are sure that if policies are put in place and if other indigenous companies of the private sector set realistic targets and works at it, Nigeria can grow a gold economy in excess of a billion dollars within a short time. We have the natural and human resources and if we combine the two via policies that are developmental, we can rival Dubai and Mumai with gold trading alone.
So everyone in the gold mining, trading and processing chain have a role to play, but the government has to lead the way.
Do you share the view that the mining sector can rival and replace oil and gas as source of revenue generation for Nigeria?
I would not want to make a comparison, but it is undisputable that Nigeria has all it takes to create a huge economy that can sustain the country by developing her gold resources.
Dubai, Mumbai and Singapore do not mine gold but have been able to develop a huge economy based on trading in gold. Since they have achieved that feat by trading, not mining, Nigeria, which has gold deposits in large commercial quantities, should be able to do a lot more.
The Point is that those countries have built a huge and stable economy by trading in minerals that they don’t mine, and which they don’t have.
It is easy for anyone to visualize what Nigeria can achieve if we mine our gold and trade it.
Nigeria’s gold and tin are very strategic minerals for economic development and we should take advantage of this. We should be quick to discover that gold and tin are ‘low hanging fruits’ that we must pluck early enough.
We have the natural and human resources and, if we combine the two via policies that are developmental, we can rival Dubai and Mumai with gold trading alone.
So, everyone in the gold mining, trading and processing chain have a role to play, but the government has to lead the way
How about capital, especially now that lending houses are afraid of the uncertainty of mining
investments?
Well, the challenge of capital is as tough as you know, but we have continued to fight it. What I know is that where there is a will, there is a way. If you are passionate about a sector, you will stay and thrive in it. If you are not passionate, you will leave.
Passion has kept me and I am here and happy to be.
I fought the challenge of capital by starting small – by trading in minerals – and then I gradually began to mine minerals, after which I specialized in gold mining and trading. If your passion is more than the huge capital needed to start, you will have a way to win. But if you have all the capital and have no passion, you will go into mining and eventually run out of it.
I enjoy mining sector administration because it is holistic and involves many issues, namely technical, business decisions, negotiations and agreement; dealing with taxation, relating with government and policy administration, and a number of commonsense factors. So, it has its own complications. If you have all the capital, you may start but unless you are able to make good decisions in other areas, all will
be lost.
What is your strategy and how do you think prospective entrants can start mining in the face of dearth
of capital?
Nigerians understand trade; they know how to buy and sell. With little cash or even with goodwill from those who trust you, you can start to supply some buyers. So, my advice is that those who really want to enter the sector should start with trading of minerals. As such, they can make profits and create the capital they need. After raising the capital, they can take the ultimate investment risk, while still trading. We know that no bank in Nigeria has financed a mining proposal because of the uncertainty of investments in mining and also because of the long gestation period needed to get investment yields.
However, government has unveiled its own fund support plans for artisanal small scale miners and that is a huge step for the
sector.
