Saudi Arabia building minerals ‘ecosystem’
- 11 December 2024
The Kingdom of Saudi Arabia, recognised as the world’s Most Improved Mining Jurisdiction at this year’s Resourcing Tomorrow Awards, is “building an entire ecosystem to transform the Kingdom into a global regional mineral processing hub”, the conference heard.
HE Khalid Al-Mudaifer, vice-minister for mining affairs, told Resourcing Tomorrow 2024 Saudi Arabia’s continuing build-up of domestic exploration and development, and its significant investment in mining cadastral and broader industry human capacity and technology, were aimed at expanding the country’s mineral production base.
However, “like any jurisdiction [it] won’t be enough to satisfy our increased mineral demand, which is driven by the huge scale of the implementation of our National Industrial Strategy and our US$7 trillion worth of giga projects”, he said.
“We are already the world’s fourth-largest net importer of minerals with our annual material trade totalling $350 billion.
“Therefore we are moving beyond just mining, leveraging our location, world-class infrastructure and investment appetite.
“Our recently established National Minerals Program aims to optimise and secure domestic mineral supply chains by coordinating government efforts to ensure a consistent supply of raw materials from local and international assets.
“We also created Manara Minerals, particularly to secure the critical and strategic minerals essential to Saudi Arabia’s development.
“And we are delivering US$100 billion [of] investment opportunities by 2035, of which $32 billion is under-development across multiple value chains such as steel, battery materials, copper, aluminium and others as we plan to become the world’s second largest exporter of phosphate fertilisers, the largest regional producer of low carbon steel and aluminium and the top regional producer of battery materials.”
Al-Mudaifer said the Kingdom was studying building a global commodity exchange in Riyadh “to serve Saudi Arabia and the world”.
The new initiatives and programs come on the back of a series of key milestones since the launch of Saudi Arabia’s mining and mineral strategy in 2018, starting with fundamental mining law and regulatory reform.
“We launched one of the largest regional geological surveys to map an area of around 600,000 square kilometres,” the vice-minister said in London.
“This is now 62% completed and its results have been uploaded and made accessible to all investors through our top-notch National Geological Database.
“Our digital portal, Ta’adeen, has been introduced to streamline licensing.
“We have provided financial incentives to support early and late-stage exploration through the Exploration Enablement Program, with an allocation of $182 million to fund 25% of early-stage exploration and up to 50% funding for feasibility studies development through the Saudi Industrial Development Fund.
“And we have started the competitive licensing rounds, which have attracted local and international investors.
“This year we’ve expanded its scope to include significant mineral belts, three-times the size of London.
“So far the total area offered through the competitive licensing rounds in 2024 increased tenfold compared to the previous year and we will offer 50,000sq.km for competitive exploration next year, which is 60-times more than we offered in 2023.
“All these efforts have resulted in a 350% increase in licenses compared to pre-transformation averages.
“In addition, our exploration spending has surged by 40% year-on-year.”
Al-Mudaifer said the Saudi Ministry of Industry and Mineral Resources had sponsored and opened a new mining science and engineering program at the country’s prestigious King Fahd University of Petroleum and Minerals to train a new generation of miners and geologists.
“Our Saudi Mining Polytechnic has seen hundreds of sponsored students graduating each year,” he said.
Experienced mining executive Jonathan Cordero, who recently joined Saudi Gold Refinery as CEO to drive growth in its portfolio of assets, said at Resourcing Tomorrow he was impressed by what he was seeing and experiencing in his dealings with authorities in the Kingdom.
He came to SGR from Eurasian Resources Group.
“I spent the last decade working with a lot of governments, preparing market entries, some of which were a bit easier and some a bit more difficult,” Cordero said.
“The key success factors for foreign direct investments lie in operational excellence.
“From my experience, there are a few things that both the Ministry of Mines and the Ministry of Investment in Saudi Arabia do extremely well.
“It starts with a well-organised mining cadastre with a large available data set that allows for early targeting of the most prospective licenses for direct application. It continues with easy access to individuals at the ministry that help navigate the regulatory landscape; the availability and speed of replies, and the general philosophy of mutual respect and joint problem solving.”
Cordero’s said Saudi Arabia’s Vision 2030 economic transition away from its historical dependence on oil, which had mining and metals as a third pillar of growth, created unique opportunities to combine skills and experience across a range of industries as the Kingdom strove to build a modern, technologically advanced and sustainable mining sector.
“I think this is one of the most interesting jurisdictions for mining and industry generally,” he said.
“The early stages of development of the mining sector in the Kingdom of Saudi Arabia require attracting talent or developing from within in a collaborative approach. Not only mining professionals but professionals from other industries can contribute.
“Mining is a team sport, requiring orchestration of complex global supply chains with a large variety of stakeholder groups.
“In Saudi Arabia we see a holistic approach of transforming the entire ecosystem, the entire economy, and I think that is the exact right approach to getting people around the table.”
Resourcing Tomorrow heard that technology would be a core element of the Kingdom’s push to fast-track expansion of its domestic mining and international mining footprint.
Al-Mudaifer said AI, and quantum competing in future, would revolutionise exploration, mining and mineral processing.
“Early discoveries, accelerated by these technologies, can significantly reduce exploration timelines,” he said.
Ivanhoe Electric CEO Taylor Melvin said the company’s 18-month alliance with Saudi Arabian mining major Maaden was “in every sense of the word a groundbreaking partnership”.
He told Resourcing Tomorrow the combination of Ivanhoe Electric sister company I-Pulse’s “pulsed power” geophysical surveying tool and proprietary machine learning-based software had attracted heavyweights such as Maaden and BHP.
“We didn't invent induced polarisation [or] electromagnetic surveying, but I-Pulse did invent a more powerful way to deliver that surveying platform much deeper into the ground over much broader areas of land, more quickly. And that's a powerful tool,” Taylor said.
“And it’s that tool that attracted Maaden to Ivanhoe Electric in Saudi Arabia and attracted BHP to Ivanhoe Electric in the US.
“Our partnership with Maaden, which is 65%-owned by the [Saudi] Public Investment Fund and 35% by the public, was a great opportunity for our company and our shareholders to gain exposure to a land package on the Arabian shield of 48,500 square kilometres.
“We're 50-50 partners with Maaden to explore that land. And we're operating that joint venture and deploying [I-Pulse] Typhoon and CGI [PulseAI].
“And even in the first year-and-a-half of that partnership we're seeing a rapid acceleration of our ability to both generate and process data.
“The more we do this the better we get at it and that's an important component of this [ML] technology.
“But the collaboration that we've had with Maaden has been exceptional. It's a true partnership, and we've been able to replicate that dynamic with BHP in the US in an exploration alliance in the southwest.
“What's important is you find partners where you have a common goal, you've got buy-in from the top down in your organisation, and you're able to accomplish great things.
“What we bring to the table as a small company is a nimble mindset and being able to move quickly.
“In the case of the Maaden joint venture we signed that deal in the beginning of 2023, we closed it in the summer of 2023 and we had the first Typhoon machines in the country before the end of 2023 and we completed our first surveys [by the] second quarter of 2024.
“We're drilling right now.
“That type of rapid execution and deployment of resources is what we can bring to the table as a smaller, more nimble company.
“But you couldn't do that in Saudi Arabia without the support of the government.”
