Saudi Arabia has launched an incentive package worth 685 million Saudi riyals ($182 million) for mining investors in the kingdom, along with several other incentives, as Riyadh looks to quickly develop and support the lucrative sector that will play a pivotal role in the transition to green energy.
Al-Monitor reported in January that the Gulf country plans to award more than 30 mining exploration licenses to international investors this year and has revised its estimates for untapped mineral resources to $2.5 trillion, up from a 2016 forecast of $1.3 trillion. The $182 million program, first announced by Saudi Mineral Resources and Industry Minister Bandar Ibrahim Alkhorayef the same month, was formally launched Tuesday.
The Saudi Ministry of Industry and Mineral Resources and the Ministry of Investment have developed the incentives to reduce risks for exploration companies during their initial stages and stimulate funding in the sector, the Saudi Press Agency (SPA) reported Tuesday. The ministries said the support package will help companies and investors looking to venture into mineral resource exploration within the kingdom.
The mining sector is a key pillar of Crown Prince Mohammed bin Salman’s Vision 2030 agenda to diversify the country’s economy away from a reliance on oil. Many minerals such as cobalt, lithium and nickel are crucial to battery performance, which will help power the global transition to green energy to meet climate goals. Furthermore, rare earth elements help make magnets vital for electric vehicle motors and wind turbines. As a result, countries globally are scrambling to lead the way in this lucrative sector that will prove vital to the electrification economy of the future.
