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Saudi Arabia’s state-controlled mining company will invest $110 billion over the course of the next decade boosting production of phosphates, aluminium, and gold as it looks to become one of the world’s biggest commodity producers, its chief executive said in an interview.
Maaden’s investment plans will see the company triple its phosphate and gold business and double its aluminium business, Bob Wilt told Semafor. “We are deploying capital at an unprecedented pace,” he said. Maaden has “eight megaprojects on the books right now,” with two already underway and six others in various stages of planning.
Also among those spending plans is a joint venture with MP Materials — of which the US government is a major shareholder — and the US Department of Defence to develop a rare earths refinery in Saudi Arabia in order to supply the defence industry, a project that was initially announced during Saudi Crown Prince Mohammed bin Salman’s visit to Washington in November.
Maaden is working on “very aggressive” timelines on that particular plan and will make a final investment decision by the end of the year, Wilt said. The refinery is expected to be a significant contributor to US demand for rare earths, a crucial part of modern defense systems.
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Maaden’s investments will help Saudi Arabia’s balance of payments through increasing exports of phosphates and reducing aluminium imports, Wilt said, as the kingdom embarks on a huge construction program involving the buildout of data centers, homes, stadiums, and other infrastructure as it looks to diversify the economy.
“We want to be world champions. That doesn’t mean the biggest mining company in the world but we want to provide the minerals for strategic impact, downstream development, to boost GDP, and help with the balance of payments,” Wilt said. “I don’t really care if we’re bigger than BHP,” he continued, adding that “we will be among the largest mining companies in the world in a decade.”
Saudi Arabia has said it has identified $2.5 trillion of metals and minerals inside the country and wants to make the industry a pillar of its plan to diversify the economy beyond a reliance on oil sales. Yet foreign investment in the sector has been slow to arrive, leaving local players to drive new projects.
Maaden’s investment plans will require the company to continue to tap international debt markets after its debut $1.25 billion bond sale last year. It will also continue partnering with both the US and China, even as the two countries have an increasingly adversarial relationship, Wilt said: “We’re trying to bring the best of what China has to offer the minerals sector in terms of capability and know-how, and at the same time we are strategically aligned with the US on critical minerals.”
Maaden will now shift its exploration focus to looking for copper in the kingdom, after announcing this week it had discovered 7.8 million ounces of the precious metal. That should be enough for its gold expansion plans for the next five to seven years, Wilt said.
He also said Maaden has no current plans to take part in a global wave of mergers and acquisitions sweeping the mining industry. “I definitely don’t have any FOMO,” he said.
Notable
- US companies are seeking partnerships with Saudi Arabia to develop new mining projects, Arab News reports.