Saudi Arabia is expecting a new commodities investment boom after a report revealed the Kingdom could be sitting on $1.3 trillion worth of rare untapped mineral deposits.
Khaled Al-Mudaifer, vice minister for mining affairs with the Ministry of Industry and Mineral Resources, told CNBC Arabia that he expected the current SR170-180 billion of mining investments to increase by 150 percent in the next decade.
He added the investment could provide up to 220,000 jobs.
The resources include phosphate, gold, copper, zinc, nickel, and other rare earth minerals.
Mining is increasingly a key element of Saudi Arabia’s economic development, after energy and petrochemicals, as the Kingdom seeks to wean its economy off oil production and exports.
Global demand for minerals is increasing as the world economy moves towards cleaner energy to combat climate change.
Rare earth minerals are key components of mobile devices, such as phones and laptops, and electric cars.
The Kingdom’s mining industry has already attracted a number of foreign investors, most notably global giants Barrick Gold and Alcoa.
Al-Mudaifer said 1,800 mining licenses — issued tens of years ago — are still valid.
The ministry received more than 1,500 licensing requests upon the launch of the new mining law this year, which makes it easier for foreign companies to invest.
In addition, 274 mining licenses have been issued year-to-date, eight of which have an average estimated investment of SR250 to SR500 million.
Al-Mudaifer said: “This is just a start under the new mining investment law.”
He added Saudi Arabia is looking to be one of the world’s top 3 phosphate producers, and plans to enhance the copper industry by constructing a copper melting facility.
New investments in the mining sector continued to grow with an annual increase of 36.2 percent for the first quarter of 2021 compared to the same period a year earlier.
The total number of investment licenses issued in the mining sector has reached 478 since the second quarter of 2020.
Earlier this year Al- Mudaifer said his ministry would invest $3.7 billion to develop the sector to “maximize the value of the Kingdom's mineral resources”.
At the time he also announced a five-year Regional Geological Survey Program, which will create detailed mapping of more than 700,000 square kilometers of the mineral-rich Arabian Shield, in western Saudi Arabia.
Saudi Arabia’s metals and mining sector is creating investment opportunities in line with the Kingdom's Vision 2030 objectives.
The central and northern parts of the country contain large amounts of bauxite, in addition to deposits of silver, zinc, copper, magnesium, and kaolin.