The capital allocated is to discover and mine mineral resources in Saudi Arabia, but African miners should take note. Saudi is flush with cash and is making moves to expand its economy from mostly oil-driven to include minerals associated with the energy transition away from oil and gas. It has made several statements recently indicating high interest in financial partnerships in Africa. As Saudi builds its home capacity and expertise it will be more likely to venture into Africa where much more mineral wealth sits.
According to Reuters, Saudi Arabia has established a $182 million scheme to explore for minerals within the country. The oil economy is looking to move beyond just oil and in particular hungry for minerals such as phosphate, gold, copper and buaxite. The Gulf state claims to be sitting atop $2.5 trillion worth of untapped minerals, up from $1.3 trillion from a 2016 forecast. The exploration investments will come in the form of subsidies and other de-risking measures for greenfield projects and junior minors to emerge.
This matters for African miners because Saudi Arabia recently announced that it will provide $533 million in loan guarantees to 12 African nations through its Saudi Development Fund. The Kingdom has pledged a further $1 billion in African investments and has an interest in mining evidenced by recent investments including a 67% stake in Ma'aden mining company. Saudi stated last year that it has a $10 billion export target from Africa and was prepared to put money behind the words and targets.
As to mining, in March of 2023, Yasir Al Rumayyan, Governor of the $777 billion PIF stated in Johannesburg at a mining forum that, "...[Africa's] geological landscape is exceptionally rich and we believe, through partnerships and collaboration, that we can develop a mutually beneficial ecosystem for [Africa's] mining sector and unlock significant value for both."
In November of 2023, Bandar Alkhorayef, Minster of Industry and Mineral Resources said at a Saudi-Africa mining conference in Riyadh that, "[w]e see Africa as a key partner in our mining ambitions... There are significant opportunities for cooperation, knowledge sharing, and joint ventures in exploration, extraction, and value-added processing."
And most recently, in Davos in January 2024, Mohammed Al Jadaan, Saudi's Finance Minister said, "Africa holds immense potential for economic growth and diversification... Saudi Arabia is committed to supporting this journey through targeted investments, infrastructure development, and knowledge sharing initiatives."
