Saudi Arabia wants to be the Saudi Arabia of minerals
IN WA’AD AL-SHAMAL, 1,200km north of Riyadh, the Saudi capital, phosphate is extracted and bathed in chemicals to turn it into an acid. From there it is shipped 1,500km east by rail to the port of Ras Al-Khair. The stuff is then made into fertiliser or its precursor, ammonia, and sails west to Brazil, south to Africa and east to India and Bangladesh, where it ends up with farmers who, according to Ma’aden, the state mining firm which runs the project, grow 10% of the world’s food. The venture is vast. Its sales and domestic investment are equivalent to about 2% of the kingdom’s non-oil GDP. Another similar one will soon start shipping the equivalent of another 1%.
Phosphate is not the only mineral resource Saudi Arabia is eyeing to fuel its post-oil future. On January 10th the government revised its estimate of the value of its buried mineral wealth from $1.3trn to $2.5trn. This includes deposits of gold, copper and zinc. By the standards of Saudi oil riches, worth perhaps $20trn at today’s prices, that looks modest. By any other measure, it is gargantuan.
Muhammad bin Salman, the kingdom’s crown prince and de facto ruler, wants the country to become as indispensable for minerals, including those needed for the energy transition, as it is today for black gold. He intends to achieve this without embracing the resource nationalism that has gripped other countries, from America to Chile and China. Intrigued, mining bosses and ministers from around 80 countries had assembled in Riyadh as we published this, for the country’s Future Minerals Forum. As if to prove its commitment to openness, the kingdom has signed agreements both with Russia and with America’s Export-Import Bank. It expects deals worth $20bn to be sealed at the event.
2024-01-11 08:57:26
Source from www.economist.com
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