In an ambitious move to harness an estimated $2.5 trillion in mineral wealth, Saudi Arabia is rolling out incentives and issuing additional licenses to mining companies eager to tap into the country’s vast resources.
The Kingdom’s Ministry of Industry and Mineral Resources has reported a significant uptick in the number of applications for mining licenses. This surge follows the enactment of the new Mining Investment Law in January 2021, designed to attract investments, accelerate sector development, and expand Saudi Arabia’s mineral production.
Since the law’s implementation, the number of exploitation licenses has soared from eight to 19 in 2023, marking a 138 percent increase.
The strategic vision of Saudi Arabia includes transforming the mining sector into a cornerstone of the national industry and establishing the country as a leading destination for mining ventures globally. The Kingdom is keen on maximizing the exploitation of its mineral resources valued at approximately SR9.4 trillion ($2.5 trillion).
The streamlined process for securing mining licenses introduced by the Mining Investment Law has been a magnet for both domestic and international investors. Evidence of this is seen in the 241 percent jump in building material quarry licenses, which have gone up to 538 in 2023 from just 158 before the law’s introduction. Similarly, exploration licenses have increased to 259, up from 58—a 347 percent rise.
Initiatives like the Accelerated Exploration Program are credited with the increased issuance of licenses. These initiatives have significantly reduced the timeline for obtaining necessary approvals, which previously could take several months.
In a collaborative effort with the Ministry of Investment, the Ministry of Industry and Mineral Resources has unveiled a new package of mineral exploration incentives, valued at nearly SR685 million ($183 million). This package aims to spark further investment in mining exploration and support the national economy. These efforts align with the Kingdom’s Vision 2030 and its sustainable development goals.
The incentives are crafted to enhance geological knowledge, uncover untapped mineral resources, and develop local exploration capabilities. They offer support to investors engaged in exploration activities, bolstering local talent and expertise within the mining sector.
Companies holding valid exploration licenses for under five years are eligible for support amounting to up to SR7.5 million ($2 million) under the new incentives. Additionally, companies may receive support for as many as 15 licenses, provided they meet the program’s stipulations.