Saudi Arabia Holds $2.5 Trillion in Mineral Reserves, Key in Rare Earths Race
Saudi Arabia is emerging as a significant player in the mineral sector, highlighting its $2.5 trillion mineral reserves. This includes crucial rare earth elements, positioning the country strategically in the global supply chain for advanced technology and clean energy.
Saudi Arabia’s Investment in Mineral Reserves
According to analysts, Saudi Arabia aims to diversify its economy beyond oil. This strategy aligns with its ambitious Vision 2030 plan, which identifies mining as a key element for growth and development.
Composition of Mineral Reserves
- Gold
- Zinc
- Copper
- Lithium
- Rare Earth Elements
- Dysprosium
- Terbium
- Neodymium
- Praseodymium
These minerals are essential for various technologies, including electric vehicles and green energy products. The Saudi government has reportedly increased its budget for exploratory mining by 595% between 2021 and 2025, although it still lags behind leading mining nations like Canada and Australia.
Licensing and Exploration
Saudi Arabia is expediting the licensing of new mining sites for both domestic and international companies. This proactive approach aims to attract investment and enhance its mining capabilities. However, industry leaders, like Abigail Hunter from the Minerals Center at SAFE, caution that mining projects require significant time to develop, often taking several years to establish processing plants.
Major Investments and Partnerships
At the Future Minerals Forum in Riyadh, state-owned mining company Maaden announced a substantial investment plan. The company will allocate $110 billion to develop the mining sector over the next decade, focusing on international partnerships and talent acquisition.
Geopolitical Implications
Saudi Arabia seeks to become a regional hub for the refining of critical minerals. This ambition has garnered interest from the United States, especially given recent restrictions on rare earth exports from China. Saudi Arabia’s plans include a collaborative approach, highlighted by its partnership with US-based MP Materials to establish a new refinery.
Challenges Ahead
Despite its grand ambitions, Saudi Arabia faces various challenges, including regional instability and complex diplomatic relationships. Environmental concerns also remain a significant consideration, as the country navigates its transition into a critical mining hub.
Experts note that this initiative is not merely about immediate economic returns. It represents a long-term strategy to enhance Saudi Arabia’s geopolitical influence and establish it as a pivotal player in the global mineral markets.
