JEDDAH, 2 July — Saudi Arabia’s annual gold production is expected to reach 14 tons within two years thanks to new mining regulations and the growing interest by the private sector in investing in the sector.
The Ministry of Petroleum and Mineral Resources signed with the Canadian company WGM an agreement on Saturday to prepare a study on the Saudi mining industry. WGM will make an assessment of mineral deposits including precious and non-precious metals in various parts of the Kingdom and propose the requirements to develop the infrastructure.
Ali Berman, a representative of the Canadian company in the Kingdom and chairman of the Berman and Kanoo Mining Company, told Arab News that the study would open new investment opportunities in the sector.
Informed sources said the new mining regulations were flexible and therefore would attract foreign and local businessmen to invest further in the sector. It would also simplify procedures for issuing mining concessions. The new system offers equal opportunities for both Saudi and foreign companies, but contractors are obliged to hire Saudi nationals in their work force.
Dr. Zuhair Nawab, undersecretary at the ministry, said Saudi Arabia ranked 27th in the world in terms of gold production four years ago after output from Mahd Addahab and Sukhaiberat mines reached 11 tons annually.
Gold concentration in Mahd Addahab is estimated at 26 grams per ton while it is 21 grams in Sukhaiberat. The gold output from the two mines, according to Nawab, declined last year to five tons annually.
Nevertheless, Nawab is optimistic about the country’s golden prospects and believes that it would repeat the Australian experience. The annual gold output in Australia jumped from three tons to 100 tons within eight years after private companies started investing in the sector.
Market analysts have advocated the economic viability of investment in the Kingdom’s mining industry. There are several gold mines in the country including Al-Hejar near Bisha, Al-Emar near Quwaieya, Handha and Dulm located along the Riyadh-Taif Road.
In a related development, Madinah Governor Prince Muqrin announced on Saturday that there are many opportunities awaiting investors in the region’s mining sector. He said 25 out of 43 areas with proven deposits of gold remain untouched.
Dr. Saleh Al-Harithy, secretary-general of the Madinah Chamber of Commerce and Industry, said the chamber would present these opportunities during national and international meetings to attract investors.
There are more than 20 varieties of metals in the Kingdom, Nawab said, adding that investment in the mining sector would boost the national economy.
Abdullah Taher Al-Dabbagh, chairman of Maaden Company, which manages Sukhaiberat and Mahd Addahab gold mines, had earlier stated that his company produces 120,000 ounces of gold annually. This is in addition to 300,000 ounces of silver, 900 tons of copper and 3,000 tons of zinc.
As part of the Kingdom’s efforts to expand the mining sector, the Ministry of Petroleum and Mineral Resources is planning to set up a college of mining either in Yanbu or at Mahd Addahab. The college will be run by the private sector under the supervision of the ministry.
