Break out moment for Saudi Arabia’s mining industry

August 11, 2014 4:07 pm

Saudi Arabia is accelerating its mineral resources development plan in an initiative that will facilitate the development of its mining sector, industry leaders in the kingdom have told MEED.

“The aim is to establish mining and its support services as the third pillar of the Saudi Arabian economy after hydrocarbons and petrochemicals,” says Sultan bin Jamal Shawli, Deputy Minister for Mineral Resources at Saudi Arabia’s Petroleum & Mineral Resources Ministry.

“We have the minerals, the market and the potential to explore them. We are now turning to the private sector in the kingdom and the world outside to help us achieve our ambitious goals.”

“Mineral deposits in Saudi Arabia are widespread and of many types, ranging from metallic and non-metallic to lightweight aggregate,” says Dr Zohair A Nawab, president of the Saudi Geological Survey (SGS), the kingdom’s globally-well respected minerals research and development agency based in Jeddah.

“In the west, the Precambrian structure known as the Arabian Shield contains most of Saudi Arabia’s known metal deposits of gold, silver, copper, zinc, iron, and magnesium. East of the shield, the Phanerozoic zone contains oil resources and deposits of bauxite, phosphate, clay, limestone, silica sand, and lightweight aggregate that are of increasing importance to the industrial development of the kingdom. In total, these represent world class deposits.”

“There is great potential in the Arabian Shield and an enormous diversity of minerals across the kingdom,” says Khalid S al-Mudaifer, president and chief executive officer (CEO) of the Saudi Arabian Mining Company (Ma’aden), the kingdom’s listed minerals and mining joint stock company. “There is strong potential for further discoveries and these will require the application of modern techniques and a wide range of support services.”

Shawli, Nawab and al-Mudaifer will be keynote speakers at the Saudi Mining and Minerals Symposium 2014, a conference and exhibition to be held at the Al-Faisaliah Hotel in Riyadh on 10-13 November. Its organisers expect the event will be attended by up to 4,000 local and international visitors and delegates.

To be addressed by more than 100 speakers from government and business in Saudi Arabia and the world outside, the Saudi Mining and Minerals Symposium 2014 will provide the latest facts and insights about trends and opportunities in the kingdom’s minerals and mining supply chain.

The event is being organised by MEED Events and Montgomery Star under the patronage of HE Ali A Al-Naimi, Saudi Arabia’s Minister of Petroleum & Mineral Resources who will open the event on 11 November.

Activity in Saudi Arabia’s mining industry is rising to a new crescendo in 2014. Later this year, the kingdom’s first bauxite mine, with capacity to produce 4m tonnes a year (t/y), and the region’s first alumina refinery, a unit with capacity to process 1.8m t/y, will start operating together with a 380,000 t/y rolling mill in Ras al-Khair Mineral Industrial city on Saudi Arabia’s Gulf coast. This will complete the kingdom’s bauxite-to-finished product integrated value-chain programme being developed by Ma’aden in partnership with Alcoa of the US. The 740,000 t/y Ma’aden Aluminium Company smelter, the first of the four elements of the Ma’aden-Alcoa project, started operating in 2012. Bauxite will be delivered to the alumina smelter on the kingdom’s north-south mineral railway, which connects the Baitha bauxite mine with Ras al-Khair.

“The completion of Ma’aden Bauxite Mine, Alumina Refinery, Smelter and the Rolling Mill will be a historic moment for the minerals and mining industry of Saudi Arabia and the whole Middle East,” says Ma’aden’s Al-Mudaifer.

“It means Saudi Arabia will have the largest and most efficient vertically-integrated aluminium complex in the world.”

The projects are expected to support tens of thousands of jobs in downstream and support industries.

The mineral railway, which was owned and built by the Saudi Arabian Railway Company SAR, is already operating. It delivers phosphates produced at the Al Jalamid phosphate mine by the Ma’aden Phosphate Company (MPC), a joint venture with Saudi Basic Industries Corporation (Sabic), to the MPC complex in Ras al-Khair.

Ma’aden also is developing a $7.5bn integrated phosphate project in partnership with Sabic and The Mosaic Company. The new facilities will be part of King Abdullah Project for Wa’ad Al-Shamal City Development, and due to start operating in 2016.

The ground-breaking initiatives in bauxite and phosphates complement the kingdom’s longstanding reputation as a source of gold, which has been mined in the Arabian Shield for 3,000 years. Today, the kingdom produces about 140,000 ounces a year of gold. This is forecast to grow to at least 500,000 ounces in 2022.

New horizons are now being scanned.

“We are exploring for and evaluating new mineral resources,” says al-Mudaifer.

“We are evaluating the potential of several industrial minerals and base metal deposits. They include refractory clays, low-grade bauxite, kyanite, graphite, pure limestone, potash and iron ore. Base metals under consideration include copper, lead-zinc and nickel-copper deposits.”

The Saudi Mining and Minerals Symposium 2014 will hear how government agencies are working together to deliver a radical acceleration in the exploitation of the kingdom’s minerals.

Says Petroleum & Mineral Resources Minister Al-Naimi: “Saudi Arabia has taken a series of policy decisions to upgrade investment laws that will lead to a new dynamic chapter in the history of its mining industry and economic development.”