JEDDAH, 3 March 2005 — Ministers and top officials from seven Arab countries including Saudi Arabia, Jordan, Qatar, Iraq and the United Arab Emirates will attend a three-day seminar on mineral investment opportunities in Arab countries, which is scheduled to open here on Saturday. Saudi Arabia will present four papers highlighting investment opportunities in the Kingdom’s lucrative mining sector. The Saudi Ministry of Petroleum and Mineral Resources has so far licensed 1,100 mining projects, which made revenues worth SR11.5 billion.
Prince Faisal ibn Turki, adviser at the Ministry of Petroleum and Mineral Resources will preside over the first working session where Amr Al-Dabbagh, governor of Saudi Arabian General Investment Authority (SAGIA), will present a paper on new investment climate in the Kingdom.
Sultan Shaweli, acting deputy minister for mineral affairs, will speak on the new mining investment law. The law, which was passed by the Cabinet on Sept. 13, 2004, is expected to make the mining sector the third pillar of the economy, alongside hydrocarbons and petrochemicals.
The law, which has simplified and procedures streamlined, for obtaining exploration and mining licenses, offers local and foreign investors a number of benefits, including tax-free import of equipment and spare parts, the right to obtain multiple licenses, and the ability to explore for various minerals in the licensed area.
Dr. Abdullah Al-Dabbagh, president and chief executive of Saudi Arabian Mining Company (Maaden), is another important speaker at the seminar. He will speak on Maaden’s experience in attracting foreign investment. Maaden is currently seeking foreign investment to carry out a number of vital projects.
The seminar is being organized by the Ministry of Petroleum and Mineral Resources in coordination with the Arab Organization for Industrial Development and Mining. Talaat Al-Dhafir, director of the organization, said he hoped the seminar would help integrate mining regulations and policies in the Arab countries.
Saudis hope to make use of the gathering to attract Arab funds to its mining projects. Maaden plans to produce 100 tons of gold within 10 years and according to Muhammad Hani Al-Dabbagh, vice president for precious metals operations, it requires SR2 billion in investments.
Maaden was established with a capital of SR4 billion in 1997 in order to utilize the Kingdom’s rich mineral resources. The company, which is involved in huge projects, is now estimated to be worth several billion dollars. Its flagship project is to convert bauxite from a planned mine at Zubairah in the north at a refinery and smelter at Ras-Al-Zawr on the east coast.
The company also plans a phosphate fertilizer plant at Ras Al-Zawr, powered by a new oil-fired power station, with exports facilitated by a planned port. The project will cost $4.6 billion. Maaden has already spoken to major international companies including Alcoa and Alcan, and Chalco, the leading producer of aluminum in China, for likely participation in the project.
Maaden has set up four companies, for gold, phosphate, aluminum and industrial metals respectively. The idea is to give the state the flexibility eventually to dispose, through initial public offerings of its mining industry stakes.
In May last year, the government approved steps to privatize Maaden, which is fully owned by the government. The company intends to sell 40 to 50 percent of its stake in the precious metals sector. According to press reports, Maaden has SR600 million investment in the sector.