Saudi Arabia's new mining law will be operational in January ahead of an auction for mining blocks in 2021 to tap an estimated US$1.3 trillion worth of mineral potential, said Vice Minister for Mining Affairs Khalid Saleh Al-Mudaifer.
Al-Mudaifer told the International Mining and Resources Conference, hosted online in Australia on Nov. 24, that new applications for online exploration licenses will be accepted from December. Certain mining blocks will also be made available to investors in a public auction process in 2021.
The new mining law, which he said was benchmarked against international best practices, is part of the country's Vision 2030 program to diversify the country's economy from dependence on its massive oil sector. The mining sector was identified as a potential third pillar of Saudi industry alongside petroleum and petrochemicals.
While over US$40 billion has been invested by public and private partnerships across commodities in the past decade, Al-Mudaifer said the government's research indicates the total value of the kingdom’s mineral resources exceeds US$1.3 trillion.
Saudi Energy Minister Khalid Al-Falih first flagged that figure in 2018, according to the U.S. Department of Commerce.
Al-Mudaifer said Saudi Arabia already has an "integrated mine to metal value chain" in aluminum and is undergoing expansion in the phosphates value chain to become the third-largest global supplier of phosphate fertilizers.
Local demand for minerals is also high, and Al-Mudaifer said that while Saudi Arabia is the world's fourth-largest importer of metals and mineral products, the new industrial activities triggered by Vision 2030 will mean increased domestic demand.
He said the government is improving the beta version of its new web-based platform Ta'adin, which will be the point of access for mining license applications. The beta version of its digital national geological database already allows online access to 80 years of national records, including 10,000 reports on mining targets and prospects.
The vice minister, formerly CEO and president of Saudi Arabian Mining Co. (Ma’aden), said that while his country has existing partnerships with Alcoa Corp., Barrick Gold Corp. and Mosaic Co., the government is enhancing the ease of doing business and upgrading its geological database to achieve new growth.
In October, Saudi Arabia launched a six-year, 600,000-square-kilometer regional geological survey, which Al-Mudaifer said will be one of the world's largest. It will collect and analyze over 100,000 rock samples from the Arabian-Nubian Shield in Saudi Arabia.
This work will include airborne geophysical surveys, multi-element geochemical surveys and geological mapping, the results of which will be made publicly available to help accelerate exploration, he said.
The government has also sought to clarify regulations, improve governance, increase digitalization and streamline procedures.
To support this increased activity and investment, Al-Mudaifer said Saudi Arabia needs more companies to get involved in exploration, mine development and operations, along with related sector service delivery, and investment in both upstream and downstream areas.
He said Saudi Arabia is seeking international partners in services related to waste management, vocational training, standardization, resource and reserve studies, asset inspection, environmental monitoring, site rehabilitation and logistical support.