| 21 May 2024, Tuesday |

Saudi Arabia accelerates transition to clean energy

The second edition of the Future Minerals Forum kicked off in Saudi Arabia under the patronage of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz.


The Forum aims to develop dialogue on the future of minerals and investment in mining and boost cooperation throughout the area extending between Africa and West and Central Asia.


Several ministers disclosed a diverse portfolio of minerals in Saudi Arabia, noting that the Kingdom aimed to activate its mineral resources and use them for peaceful purposes and the transition to clean energy and future technologies.


– Nuclear fuel


Minister of Energy Prince Abdulaziz bin Salman affirmed that Saudi Arabia intends to utilize its domestically-sourced uranium to build up its nuclear power industry, including in joint ventures with willing partners, following international commitments and transparency standards.


He added that recent discoveries showed the country’s diversified portfolio of uranium.


He told a mining industry conference in Riyadh that this would involve “the entire nuclear fuel cycle which involves the production of yellowcake, low enriched uranium and the manufacturing of nuclear fuel both for our national use and of course for export.”


– Expanding the scope of mining


For his part, Minister of Industry and Mineral Resources Bandar al-Khorayef revealed the completion of the construction of an entire industrial city to process aluminum from raw materials and bauxite, all the way to final value-added products used in the automotive industry and food packaging.


Khorayef said at the conference that the Kingdom has succeeded in crystallizing its essential and significant role in the mining sector, launching a constructive dialogue in the industry and achieving fruitful cooperation between countries in this field.


He pointed out that the Forum is an initiative to bridge the gap in the mining sector while building Saudi Arabia’s minerals strategy.


He said that Africa, Central, and West Asia provide 33 percent of the world’s mineral resources, pointing out that the region lacks a platform that brings together companies, institutions, and organizations.


“Our region lacks a platform that brings together relevant parties from governments, the mining sector, companies, financial establishments, civil society organizations, service providers, and academic circles.”


He stated that the platform would also increase the region’s contributions to global supply chains for minerals, with the guarantee that this is done in the best possible way and maximizing its social and economic impact.


The Forum witnessed the participation of 2,000 representatives from 130 countries and 200 speakers, with the involvement of government representatives, industry workers, investment leaders, technology suppliers, and intellectuals.


Khorayef explained that within Vision 2030, the Kingdom developed many programs to promote the mining sector to become the third pillar of the industry.


He noted that authorities completed a comprehensive review and updated the mining investment system, which constitutes the regulatory base for the sector, and provides a transparent and accessible environment for investors.


Khorayef explained that the second Ministerial Roundtable of ministers and delegations responsible for their countries’ minerals and metals strategies focused on the emerging mining region from Africa to West and Central Asia.


The region has promising mining potentials and capabilities that enable it to bridge the expected gap in future demand.


– The future of metals


All parties concerned with mining wished to be part of this initiative, Khorayef said, adding that now is the right time to expand the mining sector in the region and globally and find a sustainable mining chain.


“We will be working, through the forum, to strengthen the dialogue between the active parties in the mining sector, learning and exploring the latest technologies and technical developments in this sector,” Khorayef said.


The second edition of the conference discusses a set of pressing issues, including the development of the region, increasing its contribution to value and supply chains, promoting responsible and sustainable mining, and making the most of mineral resources in the emerging mining region that extends from Africa to West and Central Asia.


– Clean minerals


The Minister pointed out that the goal is to develop the region to become an integrated center for the production of green minerals and discuss the development of international cooperation to establish centers of excellence in the area to increase its contribution to the supply of future minerals.


Khorayef stressed the importance of trust of all stakeholders involved, including upstream, midstream, and downstream, and the vitality of collaborating as a region.


“Together, we have a stronger voice when decisions about our future are made. Together, we can shape the future of mining and minerals. Together, we can chart a course toward a green and equitable future.”


– Financial sustainability


During his participation in a dialogue session within the sessions of the Mining Conference in Riyadh yesterday,


Saudi Finance Minister Mohammed al-Jadaan revealed joint efforts between the Ministries of Finance and Industry and Mineral Resources to support them in the legislative aspects and financial resources, aiming to maximize the growth of the mining sector in the Kingdom.


Jadaan stressed the government’s concerted efforts to support the mining sector, stressing Riyadh’s commitment to boosting the private sector and increasing its participation in the economy, noting that mining projects are exempt from customs.


He criticized the exceptional taxes imposed by governments on oil companies, indicating that they reflect selfish and unproductive thinking.


“The biggest mistake governments and policymakers make thinking about windfall tax,” the Minister added.


– Boosting growth


Jadaan asserted the need to align government policies with the expectations in the long term, noting that the Kingdom does not view the mining sector as a revenue-generating sector but rather as a sector that would contribute to Saudi economic growth.


He stressed that the government seeks to develop and diversify the economy, provide job opportunities and increase exports, indicating that following this trend would enable the government to increase revenues.


– Incentives


Finance Minister pointed out that the Saudi Industrial Development Fund provides up to 75 percent of the financing for mining projects.


Mining projects are exempted from customs, including the equipment, machinery, and spare parts, said Jadaan, indicating several incentives for the mining sector.


The Minister stressed that Saudi Arabia has a clear vision for achieving unexpected tax revenues related to exceptional taxes on the profits of oil companies, warning that this type of tax affects the sector.


He condemned the exceptional taxes imposed by some countries on oil companies, saying it is the most significant mistake governments, and policymakers make.


– Investment law


The Saudi Minister of Investment, Khalid Falih, revealed that Saudi Arabia would issue the Investment Law in 2023, adding that the Kingdom also has the appropriate environmental legislation.


Saudi Arabia gathered all the capabilities in one place and has energy solutions, location, financing, and legislation.


Falih disclosed that Saudi Arabia would reveal special economic zones in the coming weeks designed according to the requirements of the mining sector to attract minerals for manufacturing, adding value to them, and then exporting them.


He explained that investors’ evaluation would be the highest in his country, given the low carbon emissions in Saudi Arabia.


The Minister predicted Saudi Arabia to top the list of the most developed countries in mining during the coming years, expecting an increase in the demand for essential minerals that would be a key to electrifying the global economy amid acute supply shortages.


– Sustainable energy


Falih expected that the evaluation would increase the possibility of using renewable energy, including hydrogen, which is likely to be an essential factor in manufacturing many minerals.


The Kingdom will be the fastest to benefit from the mineral wealth and develop industrialization, as is the case in the oil sector, said Falih, explaining that the conference aims to discuss maximizing the use of mineral resources.


Speaking during the dialogue sessions of the Future Mining Conference, Falih said Saudi Arabia is the “world’s safety valve” for energy, whether it is conventional, unconventional, or renewable energies, wind, solar, hydrogen or ammonia, or any other emerging technologies applied in the mining industry.


He stressed that his country aims to empower the private sector in all sectors, provide the appropriate environment and legislation, and provide all financing capabilities through the Public Investment Fund.

  • Asharq Al-Awsat