Gold has become an increasingly important strategic asset in the global economy.
Prices have been on a sustained rise since 2018, increasing by about 19 per cent a year on average, according to the Financial Times.
Central banks have been buying more gold, particularly since Russia’s foreign reserves were frozen after its invasion of Ukraine. Gold became more attractive because, unlike a government bond, it is not a promise by another country to repay money. It gives central banks another way to hold wealth.
The usual relationship between gold prices and interest rates has also become less predictable. Gold can still come under pressure when interest rates and government bond yields rise, as happened sharply in late September, but central-bank purchases, geopolitical uncertainty and concerns about government debt have become stronger influences on demand.
For mining companies, finding enough new gold to replace production from existing mines is becoming harder.
Gold Fields’ proposed acquisition of Northern Star Resources illustrates both the scale of capital now involved and the value attached to established production.
Gold Fields offered A$38.7 billion, about US$27.1 billion, for the Australian producer before Northern Star rejected the unsolicited proposal on September 28. A successful bid would have created the world’s second-largest gold producer after Newmont.
Reuters reported that the proposal reflected wider consolidation pressure in the gold sector as producers seek scale, lower costs and longer-lasting reserves.
The rejection has not necessarily ended Gold Fields’ interest. Reuters reported on September 30 that the South African miner could make another approach, with investors expecting it to return with an improved offer, potentially with more cash.
Gold Fields has already expanded through acquisitions, including its A$3.7 billion acquisition of Australia’s Gold Road Resources, completed in 2025. The transaction gave Gold Fields full ownership of the Gruyere mine.
The broader development is relevant to Nigeria because it shows what established, long-life gold assets can command when major producers are looking for future production. The value lies not simply in gold being underground, but in deposits that can support large-scale mining over many years and justify the capital required to develop them.
Nigeria has extensive gold occurrences, particularly across parts of the north-west and south-west schist belts. The country has yet to establish how much of that geological potential can become economically viable production.
That is where systematic exploration becomes important.
A major international mining company does not invest billions of dollars because a mineral occurs in a particular geological belt. It needs drilling, resource estimates, metallurgical testing and feasibility work capable of showing the size, grade and continuity of an orebody and the economics of extracting it.
Nigeria already has a working example.
The Segilola Gold Mine in Osun State, operated by Thor Explorations, was built on a probable reserve of 517,800 ounces of gold grading 4.02 grammes per tonne. Thor says the mine produced 91,910 ounces in 2025, following 85,057 ounces in 2024 and 84,609 ounces in 2023. The company describes Segilola as Nigeria’s first large-scale commercial gold mine.
Segilola demonstrates that large-scale commercial gold mining is possible in Nigeria. The mine’s ongoing exploration also shows how an operating asset can provide a platform for identifying additional resources.
Nigeria now needs to determine whether other deposits can reach a comparable level of scale.
Dele Alake’s appointment as Minister of Solid Minerals Development gave the sector a minister who had worked closely with President Bola Tinubu for decades. Alake is a long-time ally and confidant of the President and their relationship dates back four decades, including Alake’s period as Commissioner for Information and Strategy in Lagos during Tinubu’s tenure as governor.
Alake was also re-elected chairman of the Africa Minerals Strategic Group in January 2026, placing him at the centre of a continental forum dealing with the development and strategic use of Africa’s mineral resources.
Under the ministry’s current drive, Nigeria has been seeking to move beyond mineral extraction towards exploration, processing and greater participation in the value chain.
There is evidence that foreign capital is already responding to opportunities outside gold. Alake has said Chinese companies have invested more than $1.3 billion in Nigerian lithium processing since September 2023. That investment provides an indication of what can happen when investors identify deposits with sufficient economic potential and a policy environment that supports development.
Nigeria and the US signed a mineral investment framework in New York in September, with Alake signing for Nigeria and US Deputy Secretary of State, Christopher Landau, signing for the American government.
The framework covers geological data and exploration, mineral development and processing, infrastructure and technical capacity, with the two governments seeking to use their relationship as a basis for business-to-business investment.
The US$700 billion figure attached to the agreement is Nigeria’s estimated mineral endowment rather than proven reserves or a US investment commitment. The framework nevertheless places Nigeria’s mineral resources in a wider competition for international capital and secure mineral supply chains.
Japaul Gold & Ventures is one indication that Nigerian companies are also developing capacity in the sector. In February, the company announced the delivery and test runs of a pilot gold processing plant at its Libeli Mine and said commercial gold production was scheduled to commence in May 2026. It also said it holds four gold mining leases across Taraba, Niger and Osun states and planned an industrial-scale processing facility for the fourth quarter of 2026.
Japaul’s exploration and processing plans show a domestic company moving towards mining and processing, adding another layer to Nigeria’s emerging gold industry.
The Nigerian Geological Survey Agency has identified gold-bearing areas across several parts of the country and continues to undertake geological investigations. What turns those occurrences into investable mining assets is evidence from exploration that can withstand the technical and financial scrutiny of potential investors.
Burkina Faso has taken a different route towards greater domestic control of its gold industry. Its government has transferred mining assets to state ownership and has been increasing the role of its state mining company, SOPAMIB.
In July, the government approved an industrial mining permit for SOPAMIB Bouboulou, where estimated production is 7.27 tonnes of gold over a projected 15-year mine life. The project is expected to create more than 1,200 jobs.
Burkina Faso has also opened its first gold refinery as the government seeks greater control over the processing and certification of gold produced in the country.
Nigeria does not have to adopt the Burkinabe model. Its own approach can combine international mining capital and technical expertise with Nigerian participation in the economic benefits created by mining.
A large commercial gold mine creates demand for engineers, geologists, laboratory workers, equipment suppliers, construction companies and transport operators. Local procurement can keep more mining expenditure within the economy, while taxes and royalties provide government revenue.
Processing can retain more value domestically where production volumes make downstream investment commercially viable.
Formalising artisanal and small-scale mining is equally important.
Thousands of Nigerians depend on gold mining outside the formal large-scale mining system. Some of the work is carried out under unsafe conditions, with limited environmental controls and weak traceability of gold from mine to buyer.
The January 2024 explosion in Bodija, Ibadan, which killed three people and injured 77, was attributed by authorities to explosives stored for illegal mining activities.
Gold’s high value and portability also make the trade vulnerable to criminal exploitation. The Financial Action Task Force has identified gold as attractive for money laundering and terrorist financing because it has stable value, can be traded anonymously and is easily transformed and transported.
A properly regulated gold industry would make it easier to establish who is mining, who is buying and how much gold is entering the formal market. It would also provide a route for people currently working in dangerous informal operations to move into licensed and safer mining activities where opportunities exist.
Nigeria is heavily dependent on hydrocarbons for foreign exchange earnings. A sizeable gold industry would not replace oil, but production at sufficient scale could provide another source of export earnings while broadening the country’s mineral economy.
The opportunity should not be measured by the estimated value of Nigeria’s entire mineral endowment. Mining investors commit money to specific deposits.
The test for gold lies in establishing through exploration deposits large enough, rich enough and technically workable enough to support mines that can operate competitively for many years.
Nigeria already has one operating large-scale commercial gold mine and a wider geological base that remains under exploration. The next step is to establish how much more of that potential can become economically viable production.
Gold prices will eventually move through another cycle. A well-defined, economically viable deposit can remain an asset for decades.
Ladigbolu is journalist based in Lagos.
Views expressed by contributors are strictly personal and not of TheCable.
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