Saudi Arabia's mining profits rise thanks to Jeddah
The London Metal Exchange recently revealed that it intends to list the Saudi city of Jeddah, on the Red Sea coast, as a new key delivery hub for copper and zinc. The main hubs listed on the world's oldest metals exchange are typically located in high consumption areas or major trading centres such as Rotterdam.
And in this regard, according to Matthew Chamberlain, chief executive of the exchange, Saudi Arabia "is an increasingly important global metals hub". For this reason, Jeddah "meets the operational and logistical standards for the location of new warehouses, as it is an important region with a high consumption of metals and has an efficient transport network".
This important recognition has been achieved thanks to the efforts of the Kingdom, which intends to launch an ambitious programme of industrial development and logistics services within Vision 2030. This industrial programme aims to transform the country into a pivotal entity on the global stage in the energy, mining, logistics and industrial sectors.
Farooq Sheikh, CEO of Logi Point, a company that operates a network of logistics complexes in the Kingdom, has expressed to Al-Arab his desire for "a long future of cooperation with the London Metal Exchange", as well as "continuing to develop relations with the international metals community". He also stressed that Jeddah has an important position in world trade and "will serve the Middle East and North and East Africa regions".
The proposal will be subject to consultation among members of the London Stock Exchange, industry players and their agents until 30 April, when a formal decision will be made.
For its part, the Ministry of Industry and Mineral Resources announced last December that Riyadh plans to establish a metals trade exchange, as the government will give more importance to this sector and investment as part of the economic transformation programme.
Khaled Al-Mudaifer, then deputy minister of industry, said that the kingdom "is studying launching a new platform for trading materials used in battery production, including graphite, rare earth elements, lithium, cobalt and even nickel".
Riyadh's efforts to boost a more diversified and less oil-dependent economy also include extracting the country's untapped mineral resources, such as copper, lithium, phosphate and gold, as well as investing in overseas assets.
In 2023 Saudi Arabia raised its estimates of the country's untapped mineral wealth potential by almost double what it had tracked the previous year, enhancing its opportunities in this sector.
Our estimates of untapped mineral potential have increased from 1.3 trillion dollars to 2.5 trillion dollars," said industry minister Bandar Al-Khorayef at the third international mining conference in the Saudi capital. Among these reserves is gold, the volume of which in the country exceeds 100 million ounces.
As for the critical minerals needed for a clean transition, Saudi officials have claimed that the value of these discovered minerals amounts to 150 billion dollars, although only 30% have been studied.
Aramco plans to extract lithium from salt water
To support this renewable transition, Saudi sources told Reuters that oil giant Aramco "plans to extract lithium from salt water in its fields, in line with efforts to diversify its economies and benefit from the shift to electric cars".
The advantage of leaching the ultra-light battery metal from salt water is to avoid the need for expensive and environmentally unfriendly open-pit mines, as used by the world's top producers.
Sources confirmed that, in addition to Aramco, ADNOC of the United Arab Emirates, ExxonMobil and Occidental Petroleum intend to take advantage of emerging technologies to leach lithium from salt water as the world seeks to wean itself off fossil fuels.
Saudi Arabia, whose economy depends on oil, has invested billions of dollars trying to transform itself into an electric vehicle hub as part of Crown Prince Mohammed bin Salman's attempts to find alternative sources of wealth.
Indeed, Ma'aden, the Gulf region's largest mining company, is working to extract lithium from seawater, which requires advanced technologies and a lot of investment.