The Saudi mining sector is being developed to play a critical role in diversifying the country’s economy.
Mining has played a significant role in the Arabian Peninsula for thousands of years. In fact, many contemporary scholars agree that it has been present in the Middle East for more than 3,000 years.
In the 1930s, mining exploration - as we now know it, was launched in the Kingdom, a little before the establishment of modern-day Saudi Arabia. In 1931, by order of the country’s founding monarch, King Abdul Aziz, geological surveys started to explore for mineral and water resources, and since then has continued growing.
Today, demand across the world is growing fast.
The global appetite for mobile computing and communication devices will only continue to grow, and at the heart of these devices is minerals. Similarly, as the energy transition economy gains momentum, we will see a huge upward surge in global demand for minerals, as clean energy technologies such as solar panels, wind farms, and electric vehicles require four to 10 times more mineral resources than their fossil fuel-based counterparts.
Saudi Arabia’s mining industry is well-placed to support this increased demand, with its vast potential of diverse and largely untapped mineral resources.
Under the Kingdom’s Vision 2030, the country’s comprehensive road map for economic development and diversification, its mining sector has been identified as the potential third pillar of the industry alongside petroleum and petrochemicals, with a planned contribution to the country’s GDP of 240 billion riyals by 2030, four times the level of 2015.
The Ministry of Industry and Mineral Resources is investing 15 billion riyals to transform and develop the sector and maximize the value of the Kingdom’s mineral resources, estimated at 5 trillion riyals.
Several significant steps have been taken to achieve these goals.
We developed a comprehensive mining strategy for the Kingdom that includes 38 initiatives designed to create and sustain a resilient industry.
We launched the National Geological Database, which includes 80 years of geological data and exploration information of the Kingdom.
We also recently launched the Regional Geological Survey Program (RGP), where 2 billion riyals has been allocated to help us identify hidden opportunities. Through a six-year program of geophysical and geochemical surveys, the RGP will create detailed geological maps of the mineral-rich Arabian Shield in western Saudi Arabia. The data obtained from this program will become available to the public, including current and potential investors. The environment created will attract more investment through the National Geological Data.
After a comprehensive review of global best practices in mining, we recently approved a completely revised Mining Investment law. This legal infrastructure is an important part of our mining ecosystem because it supports a clear and transparent process for investors.
These actions, and several others, will enable the Saudi mining sector to support domestic and international demand and enhance inbound investment.
Saudi Arabia’s domestic demand for minerals is high, as our country is the fourth-largest net importer of these materials in the world. This represents an excellent opportunity to create a homegrown, fully integrated mining sector that will drive economic growth, while offering many opportunities for young people to join this dynamic industry.
The mining sector is set to increase jobs from 250,000 today to about 470,000 by 2030.
These factors and activities are already bearing fruit. In the past six months, we have granted 73 exploration licenses and eight mining licenses.
Despite the devastating pandemic, we have seen significant progress in the development of the mining industry. In fact, the pandemic has sharpened our focus on our sector’s resilience.
We have emerged from the global health crisis confident that we are on the right track of developing the mining sector. With the strong, steady financial and operational support being installed this sector is on track to become the third pillar of industry in Saudi Arabia, and a valuable resource to the country’s economy.