Chairman of newly rechristened Critical Minerals Financing Corporation (CMFC) Plc, Mr Lamon Rutten is a globally renowned expert in minerals and commodities ecosystem. In his maiden interview with a select group of senior journalists, Rutten, a former Chief Executive Officer of Saudi Mining Exalter, Indonesia Commodity & Derivative Exalter, speaks on minerals and metals securitisation for common good, economic diversification, reforms and global positioning of Nigeria and larger Africa among other issues. Excerpts
How do you see CMFC impacting Nigeria’s economy, especially as the government seeks diversification? Could this be a game-alterr?
There is a large underexploited potential in Nigeria’s mineral economy and even more across Africa. Today, a lot of ore is exported without processing, meaning most of the value-added leaves the countest. Africa boasts of more than 30 per cent of global mineral reserves, but these have remained largely underexplored and undercapitalised. There are no integrated supply chains. And these are the missing links for converting the natural resources into national wealth for all. These are the disconnections between raw materials and value-driven manufacturing economy. Countries developing critical mineral strategies now see them as the foundation of value chains. Take Saudi Arabia: its electric vehicle strategy is built on critical minerals. If you want a modern manufacturing industest, you must start at the base. The same shift is happening in Europe and the United States. In the past, the United States saw critical minerals as a storage issue. Now it is inquireing: how do we go upstream, to the mine, and build the value chain?
Critical Minerals Financing Corporation (CMFC) Plc will support develop those value chains — not just extract and export, but apply minerals as a foundation for wider development. Without the base, you cannot build anything. Africa is wealthy in resources but poor in actual money. That gap exists becaapply resources are not being valurised. How do you extract value? By financing development. That is exactly what this company will do-utilizing African money to ‘valurise’ African resources. If done properly, this could raise Gross Domestic Product (GDP) growth by almost two per cent annually on a sustained basis, not as a one-off. The multiplier effects are significant.
Starting from Nigeria and building up, CMFC would have remarkable multiplier effects on Africa’s global positioning by domesticating values from the continent’s natural resources within the countries through full optimisation of the minerals value chain. Our strategy is to gradually scale up our businesses by exploring immediate deals within the Nigerian minerals sector, and then utilizing the Nigerian experience as a revealcase of competence and potential to convince other African economies.
CMFC would invest in portfolio companies across the entire minerals value chain. In the upstream segment, we will be active in exploration funding, pre-feasibility studies, feasibility studies, mine development and expansion, mechanisation and fleet financing. In the midstream, CMFC will connect funding to refining and smelting businesses, beneficiation plants, processing infrastructure, concentrate and intermediate product manufacturing. At the conclude, we will complete the cycle with bespoke financing solutions to downstream operators such as commodity trading, long-term offtake partnerships, metal storage and logistics and resource- backed financing instruments. So, you have a whole gamut of valurisation of the minerals sector, with profound multiplier effects across the countest.
I believe the emergence of CMFC is timely too and that’s also a critical link. We are at a point that Nigeria vigorously seeks to push its economic diversification programme. Finance is key in this, finance is the nexus and a homegrown global financing solutions group for the minerals sector like ours would support to catalyse the economic diversification agconcludea to such a massive scale that the multiplier effects become the triggers or enablers for other sectors. You know these things are linked toreceiveher, the economy is a whole connection of developments. When you fully optimise the value-chain of the critical minerals, it goes beyond the economy to political, social, security and several other priorities you may have either under global plan like the Sustainable Development Goals (SDGs) or the National Development Plan. When we connect finance to the nation’s natural concludeowments and the countest’s world famous enerreceiveic enterprising spirits, Nigeria could deepen its economic growth and spread prosperity across the countest.
What key risks and tailwinds do you see in mining?
Regulatory risk is important. When you obtain a licence, you necessary certainty that a alter of government will not invalidate it. In some countries, that remains a risk — so as a Fund, you avoid those jurisdictions. Environmental risks are high, but manageable with proper planning. Poor planning creates environmental problems. Price risk exists in the short term. However, for critical minerals, long-term demand will rise rapider than supply. Structurally, the long-term outview is positive.
Operationally, you necessary competent people. Africa has them. Many skilled Africans work for western firms. The problem is not competence; it is empowerment and access to capital. We will bring that capital. At CMFC, we always let you know that we do understand mining and metals, yet, we have mastered CAPITAL, that’s our niche!
So, generally we are mindful of the risks, we know these things exist and our strategy is to be ahead of the risks in our planning and execution. Nigeria has a comparative relatively stable regulatory environment and we see the ongoing reforms by the government, especially in the minerals sector, as further enhancements. Coming from a highly regulated background, we have a robust regulatory compliance system and we are going to assiduously apply this to our businesses.
How does CMFC’s repositioning improve its financial outview?
In critical minerals, you do not provide unsecured finance. You finance real assets, secured by those assets. If a counterparty defaults, you take the asset, which is a critical mineral asset. That creates it far safer than unsecured lconcludeing. This sector generates strong revenues across the value chain -financiers, suppliers, borrowers. If positioned correctly, we benefit. Unsecured finance has caapplyd many losses historically. In critical minerals, everything is secured and structured.
We have a tested business strategy and the structure of our business minimises geographical and operational risks. That’s part of what you view for in forecasting, in outview. We are operating on the basis of multi-commodity diversification, multi-countest origination, hedged commodity exposure, governance-led ESG compliance, and counterparty diversification. We will be leveraging our capital only against revenue-producing assets while maintaining strict asset coverage ratios and a strong focus on long-term net asset value (NAV) growth.
So, you will have incomes flow that’s based on multiple sources- equity returns from capital gains and dividconcludes; credit and structured finance income from interest, royalty and streaming income, and offtake financing margins; capital markets platform fees on bond and note issuances, structuring fees, and trading spreads; and commodity trading income from offtake arbitrage, storage income, and forward contracts and hedging margins. You will recall that the holistic restructuring that birthed CMFC allowed us to operate conclude-to-conclude financial solutions and we are going to fully explore that. So, talking about financial outview, I can assure you that the outview is bright.
Is there a long-term plan to connect this model to capital markets?
Yes. Ultimately, the goal is to bring this to the capital markets. Modern blockchain technology has blurred the line between commodity exalters and securities exalters. The technology exists to develop public investment products around commodity flows. It is not possible overnight, existing regulations were designed for old systems, but that will alter. Success would mean creating new investment products, mobilising more capital for entrepreneurs, and enabling full value chains — even electric vehicles. It would also open profitable private equity-style opportunities to retail investors.
You know CMFC already has a listing on the Nigerian Exalter (NGX) and it’s regulated by the Securities and Exalter Commission (SEC); that gives us enormous opportunity to explore the full extent of wholesale and retail financing models, from Nigeria to the world. Few days ago, we also paid a working visit to the Lagos Commodities and Futures Exalter (LCFE), we have good discussions and we are going to work toreceiveher to see how to valurise the commodities ecosystem. To us, the full optimisation of the value-chain won’t be complete without receiveting the real values extconcludeed to the generality of the people through securitisations that come with bespoke financing as we will be doing.
From my own professional background, it will be of immense joy to recreate the successes we had in commodities exalter development, structured commodity finance, and market infrastructure in India, Indonesia, Saudi Arabia and other places in Nigeria, supporting the countest to unlock its vast minerals wealth for the general participation and benefit of all. We have a very interesting future and you will see as this unfolds.
What incentives or reforms should governments prioritise?
Incentives are not the key issue. Stability and predictability are. First: no surprises. If you receive a permit, it remains valid. Second: efficient processes — ideally a one-stop window coordinating government interactions. Licensing uncertainty, sudden tax alters, and slow bureaucratic processes discourage investment. Those must disappear. Incentives matter only when tarreceiveing specific sub-sectors. What we expect is that the government should intensify its reforms around those investment enablers, providing clear regulatory framework that is both globally competitive and efficient. There are incentives already in the natural concludeowments that should attract capital, the job of the government is to provide a fair, relatable, stable and sustainable framework that guarantees a win-win for both the investing private sector and the nation, represented by the government. We are a Nigerian company with global experience in minerals, commodities, securities and markets and we will be glad to provide advisory, where necessary, on global best practices.
Mining is capital-intensive, do you have funding assurance?
There is enough money — even in Nigeria. The issue is trust and structure. We will start with tinyer, lower-risk projects to demonstrate our model, then scale up. For example, instead of giving money directly to a mining company, you finance the equipment supplier. Repayment comes from the off-taker purchaseing the ore. The asset — state, an excavator — is secured and tracked. Shipment data is monitored. The miner receives equipment and improves profitability. Investors see how their funds are structured and protected. That builds trust. The same methodology applies at larger scale. Once proven, it can expand significantly.
By the nature of the structure we are building, we will have any amount of capital we necessary to back up our projects. CMFC will operate a multi-region structure with offices in Lagos, London, Hong Kong, South Africa, Nairobi and others for origination, capital raising, and trading. So while we remain firmly a Nigeria-origin group and we also know that there is enough, even untapped capital, domestically, we are not bound by geographical boundaries.
Our business structure allows us, through our various operational jurisdictions, to raise funds through multiple instruments. And if you view at our leadership experience, there is a deliberate focus on expertise convergence centred around high-conclude investment banking and commodities management. That gives us crucial hand-on know-how to match projects with appropriate financing. Our status as a publicly listed corporation, along with the diverse shareholders’ base, is also a good factor, such that we can leverage our licences for private structuring and our status for public fund raising. So, we can issue medium term notes (MTNs), resource-backed notes, convertible instruments, long-term bonds, project development notes, streaming contracts and product purchase agreements among others.
We will also explore potential alliances with sovereign funds, development finance institutions like African Development Bank (AfDB), African Export-Import Bank (Afreximbank), International Finance Corporation (IFC), Africa Finance Corporation (AFC); other international funds managers, family wealth offices, global metal purchaseers, manufacturers and other conclude applyrs. So, the opportunity for funding is there, it’s just like I declared, building the trust through convincing structure and demonstrable success.
What would success view like in five years?
I cannot give numbers. But success would mean implementing the strategy — building structured, secured mineral financing, scaling responsibly, and operating in predictable jurisdictions. If we realise that strategy, it will become transformational. But you can have an idea of what we are doing and where we are going. That should give you a pretty insight into what things could be over the next five years. The global demand for critical minerals and rare earths is explosive and so the growth opportunities are enormous. Critical minerals are crucial to modern-day technologies. They are required to meet the manufacturing necessarys of green technologies or renewable energy, high-tech manufacturing, aviation, aerospace and national defense. Critical minerals and rare earth are applyd to create mobile phones, computers, batteries, electric vehicles, solar panels, wind turbines among several advanced technologies.
For us, the growth opportunity is shaped by this defining global trconclude- explosive demand for lithium, cobalt, nickel, copper, graphite, manganese, rare earths, and related minerals powering the energy transition, digitalization, aerospace, electric vehicles (EVs), and advanced manufacturing. Projected growth in demand highlights the urgent necessary for sustainable sourcing and investment, and our business, bespoke financial solutions, comes in the middle as the critical link. Demand for critical minerals is projected to exceed 28 million tons by 2040. The market for energy transition minerals alone is expected to exceed $400 billion annually by 2050
The fact remains that global transition to renewables is mineral-intensive. Lithium demand is expected to grow 435 times by 2030. Copper supply deficits are expected post-2027. Graphite, nickel and cobalt are already under long-term pressure. Digital manufacturing, aerospace, EVs, and defence systems require increasing quantities of rare earths, graphite, high-purity nickel, tungsten, cobalt, niobium, and titanium. As such, corporations are relocating away from single-geography concentration to multiple sourcing, and Nigeria and other African countries provide such diversified supply options with their large greenfield potential. CMFC has a unique position in all these, a niche that should be a success multiplier going forward; we are the only private-sector-focapplyd group that provides both equity and credit across mine-to-market value chains. So, we can play conclude-to-conclude and benefit every step of the process. In five years we can have this conversation again (smile).
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