Prime Highlights
- Saudi Arabia lures $32 billion of mining investment. It would be in iron, phosphate, aluminium and copper.
- Cost of exploration went up to $100 per square kilometer and is an indicator of growing investor confidence
Key Fact
- Half-way mark in 2030 target of $100 billion mining investment hit
- Cost of exploration which had been rising at 32 per cent annually far above world average of 6–8 per cent
Key Background
Saudi Arabia is racing to re-design its mining sector under Vision 2030 diversification patronage. With $32 billion committed, the Kingdom is more than half-way towards its ambitious goal of $100 billion worth of mining investment. The investments are focused on strategic metals such as iron ore, phosphate, aluminum, and copper—all critical to domestic industry and international energy transition supply chains in the country.
The contribution of Saudi Arabia’s mining sector to the GDP will go up from $17 billion in 2024 to $75 billion in 2030. All this while the government is set to make mining a third pillar of the economy, alongside petroleum and petrochemicals. The mining sector’s return in 2023 was $400 million, with further reforms bringing more returns and stabilization of sectors.
Among the strongest promoters is intense growth in expenditure on exploration. It hit an all-time $100 per square kilometer, above the four-fold 2018 rate and climbing at a 32% annual rate. That’s above the global average and a demonstration of the Kingdom’s favorable regulatory environment and mineral richness. The players in exploration have risen from 6 in 2019 to now 132 where 60% are small and medium-sized companies. Notably, almost 70% of them are foreign-owned, reflecting increasing international confidence in Saudi Arabian mining reforms.
The Kingdom places its mineral wealth on the negotiating table for development worth SR9.37 trillion ($2.5 trillion). Policy changes in recent years opened up 5,000 square kilometers of mineral belts to prospecting, and new incentive packages rolled out in March try to streamline regulation and trigger foreign direct investment. These include Ministries of Investment and Ministry of Industry and Mineral Resources working together to develop a competitive and investor-friendly environment for mining.
