Saudi Arabia to spend $3.8bn to enhance mineral exploration

Saudi Arabia is one of the world’s top phosphate suppliers and its mining sector employs around 250,000 people. (File/AFP)
Updated 07 February 2019
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Saudi Arabia to spend $3.8bn to enhance mineral exploration

  • The government has identified 51 potential exploration projects, including 14 gold and 14 copper
  • Investments will be made through the National Industrial Development and Logistics Program

CAPE TOWN: Saudi Arabia will invest around $3.8 billion to enhance access to geoscience data and reduce regulatory red tape as it looks to boost mineral exploration, senior government officials said on Wednesday.
Government plans to jump-start the Saudi mining sector form part of a broader industrial strategy aimed at diversifying the economy and attracting private-sector investments worth 1.6 trillion riyals ($426 billion) over the next decade.
Investments will be made through the National Industrial Development and Logistics Program (NIDLP), part of Vision 2030, a reform strategy led by Crown Prince Mohammed bin Salman and intended to wean the economy off oil while creating jobs.
“For some time Saudi mining has been characterised by a lack of publicly available geoscience data, longer processing times on licenses and a lack of transparency,” Khalid Al-Mudaifer, vice minister of mining, told an African mining conference.
He said the $3.8 billion would be spent on making it easier to do business and improving data quality to reduce the risks associated with investing in new mining opportunities for gold, zinc, rare earth metals and other minerals.
Saudi Arabia is one of the world’s top phosphate suppliers and its mining sector employs around 250,000 people.
The vice minister also said the government was working on a digital platform to help finalize exploration licenses within 60 days, compared to six months at present.
“Also the law allows 100 percent ownership ... and you can apply for exploration or mining licenses,” he said.
Earlier, Abdulrahman Al-Belushi, who heads mining strategy at the NIDLP, said there were vast opportunities in Saudi Arabia should investors look to exploit mineral resources valued at an estimated $1.3 trillion.
“Aside from the oil and gas in the eastern part of the kingdom, we have been blessed with tremendous geological potential that remains vastly unexplored,” he said.
The government has identified 51 potential exploration projects, including 14 gold and 14 copper, covering around 1,351 square kilometers that could be among the first targeted, another official said.


Gulf defense spending ‘to top $110bn by 2023’

Updated 15 February 2019
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Gulf defense spending ‘to top $110bn by 2023’

  • Saudi Arabia and UAE initiatives ‘driving forward industrial defense capabilities’
  • Budgets are increasing as countries pursue modernization of equipment and expansion of their current capabilities

LONDON: Defense spending by Gulf Arab states is expected to rise to more than $110 billion by 2023, driven partly by localized military initiatives by Saudi Arabia and the UAE, a report has found.

Budgets are increasing as countries pursue the modernization of equipment and expansion of their current capabilities, according to a report by analytics firm Jane’s by IHS Markit.

Military expenditure in the Gulf will increase from $82.33 billion in 2013 to an estimated $103.01 billion in 2019, and is forecast to continue trending upward to $110.86 billion in 2023.

“Falling energy revenues between 2014 and 2016 led to some major procurement projects being delayed as governments reigned in budget deficits,” said Charles Forrester, senior defense industry analyst at Jane’s.

“However, defense was generally protected from the worst of the spending cuts due to regional security concerns and budgets are now growing again.”

Major deals in the region have included Eurofighter Typhoon purchases by countries including Saudi Arabia and Kuwait.

Saudi Arabia is also looking to “localize” 50 percent of total government military spending in the Kingdom by 2030, and in 2017 announced the launch of the state-owned military industrial company Saudi Arabia Military Industries.

Forrester said such moves will boost the ability for Gulf countries to start exporting, rather than purely importing defense equipment.

“Within the defense sector, the establishment of Saudi Arabia Military Industries (SAMI) in 2017 and consolidation of the UAE’s defense industrial base through the creation of Emirates Defense Industries Company (EDIC) in 2014 have helped consolidate and drive forward industrial defense capabilities,” he said.

“This has happened as the countries focus on improving the quality of the defense technological work packages they undertake through offset, as well as increasing their ability to begin exporting defense equipment.”

Regional countries are also considering the use of “disruptive technologies” such as artificial intelligence in defense, Forrester said.

Meanwhile, it emerged on Friday that worldwide outlays on weapons and defense rose 1.8 percent to more than $1.67 trillion in 2018.

The US was responsible for almost half that increase, according to “The Military Balance” report released at the Munich Security Conference and quoted by Reuters.

Western powers were concerned about Russia’s upgrades of air bases and air defense systems in Crimea, the report said, but added that “China perhaps represents even more of a challenge, as it introduces yet more advanced military systems and is engaged in a strategy to improve its forces’ ability to operate at distance from the homeland.”