JV Article: Saudi Arabia hosts inaugural Future Minerals Forum

The Kingdom of Saudi Arabia is hosting the first Future Minerals Forum. The forum, which runs between 11-13 January in Riyadh, was created to address two of the most pressing concerns facing the world today: (1) access to the critical minerals needed to drive the circular carbon economy of the future, and (2) a more stable, reliable supply of these minerals.

As countries switch to green energy networks and transportation systems, demand for copper, lithium, nickel, cobalt, and rare earth elements is soaring. The average electric car, for example, uses six times more minerals than a conventional car, according to the International Energy Agency (IEA). Lithium, nickel, cobalt, manganese, and graphite are crucial to batteries. Electric systems require vast amounts of copper and aluminium, and rare earth elements are needed for the magnets used in wind turbines.

However, these metals are vulnerable to shortages and price volatility because their supply chains are often opaque, the quality of available deposits is declining, and mineral exploration and mining companies face more stringent Environmental, Social, and Governance (ESG) standards.

Limited access to known mineral deposits is also hindering the global transformation to greener, more sustainable economies and societies. The IEA says that three countries currently control more than 75% of the global supply of lithium, cobalt, and rare earth elements. The Democratic Republic of Congo produced 70% of global cobalt output in 2019. That same year, China was responsible for 60% of rare earth elements production and refined 50% to 70% of lithium and cobalt and nearly 90% of rare earth elements. Australia is the other major player.

The Kingdom of Saudi Arabia “is forging a path to becoming not only a regional but a global hub for exploring and mining the critical minerals needed for this global transformation,” says His Excellency Kalid Al Mudaifer, Saudi Vice-Minister for Mining Affairs at the Ministry of Industry and Mineral Resources.

“The country is building upon its strong track record of mining for gold, aluminium, and phosphate and has a vast metals and minerals endowment. Over many decades, we have made major investments in exploration and mining infrastructure, and the mining sector now contributes US$17 billion to the Saudi economy. We are also the world’s fourth-largest importer of metals.”

To consolidate the Kingdom’s position as a new and emerging global mining jurisdiction, the inaugural Future Minerals Forum will bring together representatives from regional governments and major mining regions such as China, Canada, and the United States, and investors to the global mining industry.

In his role as chair of the organising committee, His Excellency says the forum “will show how Saudi Arabia can provide a blueprint for building and financing a modern, responsible, and sustainable mineral exploration and mining industry for other countries in the Middle East, Central and West Asia, and Africa.”

“The forum will provide a platform for promoting mineral extraction and development across the region, while also creating world-class ESG structures and ensuring resilience in mineral value chains.”

Participants at the forum will have the opportunity to discuss the financing that will underpin this future mining industry “by seeing first-hand how the Kingdom has put in place the legal frameworks to transform the mining industry that — if adopted by other regional governments — could establish the region as new ‘lands of opportunity’ for mineral exploration and mining,” says His Excellency.

The Saudi government’s Vision 2030 program, he continues, provides the strategic framework for reducing its dependence on oil “by diversifying its economy and transforming the mining sector.”

A key achievement under the program has been the establishment of the new Minerals Investment Law. The law, which came into effect on January 1 2021, has already transformed the country’s legal and regulatory framework for mining says His Excellency by making it “one of the most competitive in the world.”

The new law provides “a clear and transparent legal framework for mining license applications and approvals,” he says. “It will help to diversify income by unlocking the mining investment ecosystem and lead Saudi Arabia’s mining sector on a path to stronger growth, as well as providing a model for other governments in the region and globally.”

The law has already begun to achieve meaningful results, with 13 reconnaissance licenses, 133 exploration licenses, and eight exploitation licenses awarded over the first ten months of 2021.

In addition, the Saudi government’s mining strategy has defined nearly 40 initiatives designed to create a resilient mining industry. His Excellency says that the initiatives will increase future production and expedite further exploration and development of the Kingdom’s mineral resources and “unlock further the estimated US$1.3 trillion worth of potential mineral value across the Arabian Shield.”

The Saudi government has also taken steps to de-risk new exploration in the Kingdom by providing online access to 80 years of geological, geophysical, and geochemical information, including 10,000 detailed reports on mining targets and prospects, through the newly established National Geographic Database.

In addition, a new 700,000 sq.-km geological survey of the region provides explorers with new and updated data on the Arabian Shield, which His Excellency adds “could host world-class deposits similar in scale and value to those discovered, for example, on the Canadian Shield.”

“Our mining strategy could be replicated in other countries across the region to help them exploit their mineral wealth, transforming the region into the next major mining jurisdiction,” His Excellency explains.

The global mining industry, he says, has to work towards more sustainable operations while also developing new technologies that reduce costs and that can mine deposits with lower-grade ores to produce the green metals necessary to electrify the world.

The Future Minerals Forum aims to re-imagine mining’s role as a sustainable industry in the future global economy, says His Excellency. “It will help to solidify the mining industry as a driver of value for society by delivering a strong workforce and responsible supply chains as the world transitions to a circular carbon economy.”

The preceding Joint-Venture Article is PROMOTED CONTENT sponsored by the FUTURE MINERALS FORUM and produced in cooperation with The Northern Miner.