Saudi Arabia is making a bold move to diversify its economy, announcing significant strides in the mining sector. Energy Minister Abdulaziz bin Salman revealed that Saudi Aramco has discovered “promising” lithium concentrations exceeding 400 parts per million in its operational areas. This announcement comes as part of a broader strategy to tap into the kingdom’s vast mineral wealth, with the Ministry of Industry and Mineral Resources increasing its estimate of unexploited mineral resources from $1.3 trillion to $2.5 trillion by early 2024.
The kingdom's focus on lithium highlights its importance as a crucial commodity for energy transition and advanced technologies. In a bid to reduce reliance on oil, Saudi Arabia plans to invest $100 billion in a new mineral investment project, with $20 billion already in the final engineering phase or under construction. Saudi Vice Minister of Mining Affairs Khalid al-Mudaifer spearheads this initiative, reflecting the country's commitment to broadening its economic base.
Aramco and Saudi state mining company Ma'aden have formed a joint venture to explore and produce minerals essential for energy transition. This collaboration aims to significantly expand exploration for lithium and other critical minerals and rare earth elements. Successfully extracting lithium from brine samples in Aramco's oilfields last December marks a milestone achievement for the kingdom.
The Saudi government established a $182 million incentive program for minerals exploration in January 2024, underscoring its dedication to nurturing this burgeoning sector. With potential collaborations, lithium production in Saudi Arabia could commence as early as 2027. This ambition aligns with Aramco's vision of diversification, as the energy minister stated, "Aramco can be a diversified company and its mandate has no limit."
Manara, a venture between Ma'aden and the kingdom's sovereign wealth fund, has been launched to invest in mining assets globally. This initiative aims to bolster resilient global supply chains at a time when China controls approximately two-thirds of the lithium processing market. Minister bin Salman emphasized the strategic importance of Manara, stating:
"We don't claim to have all the resources or abilities, so we've created Manara to make sure we can reach out for the resources that we need."
Saudi Arabia's ambitious plans come amid a global push to secure critical minerals. The kingdom made several announcements regarding deals, investment plans, and discoveries during its annual Future Minerals Forum in Riyadh. These efforts aim to cement Saudi Arabia's position on the world map of critical minerals.