Increasing Mineral Investment Globally and the Role of Saudi Arabia as a Catalyst

Saudi Arabia, which produces about 11% of the world’s oil, is shifting its sights to other vital resources to diversify its economy.

I had the privilege to sit down with Khalid Al-Mudaifer, H.E. Vice-Minister for Mining Affairs Kingdom of Saudi Arabia, at the 34^th annual BMO Global Metals, Mining & Critical Minerals Conference to learn more about the country’s economic transformation.

Since Saudi Arabia launched its Vision 2030 program in 2016, the country has already committed US$20-billion of its US$100-billion plan to make mining the third pillar of its economy. Vision 2030 is not just a concept, but there is actual execution already underway on its plan.

The investments will help Saudi Arabia’s ambition to become a minerals hub for the “super region,” which includes Africa, the Middle East, Central Asia and South Asia. As Al-Mudaifer told me during our fireside chat, the work underway is not only transforming the mining sector, but the whole of Saudi Arabia.

As Al-Mudaifer, who also sits on the board of Ma’aden, the country’s leading mining and metals company, explained, Saudi Arabia has drastically increased its exploration spending to US$500 million, up from US$25 million in 2018. At the same time, the number of exploration companies in the country has risen to more than 130 from fewer than 10 in recent years.

Saudi Arabia is already making progress, including cutting the approval process for exploration licenses to 90 days by the end of the year, which is down from about six months, launching a national minerals program to help it meet global demand for minerals, developing local capacities for exploration and mining, and launching the Future Minerals Forum, an annual international mining and minerals event focused on developing its mineral resources.

Al-Mudaifer explained that the country also aims to be one of the world’s leading producers and exporters of fertilizers to help with food security, and a major producer of low-carbon steel and aluminum.

“We recognize the many challenges the mining sector has, among them is lack of exploration, lack of or low-suppression spend,” he noted during our chat. “We see our role is not only for Saudi Arabia, but to help the world.”

To continue the focus on Saudi Arabia, I followed up my conversation with Al-Mudaifer by moderating a panel, which featured CEOs from Ma’aden, Manara Minerals Investment Company (a venture established in 2023 between Ma’aden and Saudi Arabia’s Public Investment Fund to invest in mining assets globally) and Vale.

A big part of Saudi Arabia’s goal is to become a catalyst for global mineral development, particularly around transition materials for low-carbon technologies. One recent report estimates that US$5.4 trillion worth of net new investments are required by 2035 to meet the growing demand for those materials.

As CEO of Manara, Pierre Chenard explained during the panel, events like the BMO Global Metals, Mining & Critical Minerals Conference, which bring together global leaders in the sector, are so important right now. “We all understand just by being here this week how important collaboration is to the whole future of our industry and our ability to meet the demands of society and in terms of supply of metals,” he said.

The panel also talked about how important technology will be to the future of the mining industry. As Bob Wilt, CEO, Ma'aden, explained, investment in technology will be critical to advancing exploration and development and meeting growing demand for mining commodities.

He described how the latest technologies used in exploration can analyze core samples seconds after they’re pulled from the earth, instead of having to send them off to a lab and wait weeks for results. Wilt said new satellite technology can also scour the landscape and pinpoint the right places to drill – all of which is helping to speed up the mining exploration and development process in Saudi Arabia.

“The cycle time from discovery to commissioning is about 20 years. I told my board that with advanced technology, with digital processing, with better techniques, we can probably shorten that timeline to nine years,” Wilt noted.

There is an interest in accelerating that timeline even further. Cutting the cycle time of traditional methodology in half isn’t good enough, he said. “We need to do even better, which requires technology and a totally different way of thinking.”

The investments in technology go beyond unlocking new ore bodies. As Vale CEO Gustavo Pimenta explained, technology is also helping companies cut costs, improve safety and make operations more sustainable. He noted his company’s best-performing mine is its fully autonomous operation in Brazil.

Pimenta said he believes the industry is just scratching the surface in terms of using technology to uncover opportunities. “There’s an enormous opportunity for us to invest and be more efficient, reduce risk, be more productive, and have a quicker time to market,” he explained.

Wilt said he’s working on setting up an exploration development venture fund to help scale mining operations in Saudi Arabia, which would be used to explore and develop mines, deploy the latest mine site technologies, and lure top talent and future generations of employees.

“We need to do a better job telling the story so the application of technology will not only solve some of the traditional problems of mining, but will also attract the next generation of talent,” he said.