Saudi Arabia to auction mining licenses in 2022

Saudi Arabia to auction mining licenses in 2022
Vice Minister for Saudi Mining Affairs Khalid Al-Mudaifer. (Supplied)
Short Url
Updated 18 June 2021

Saudi Arabia to auction mining licenses in 2022

Saudi Arabia to auction mining licenses in 2022

RIYADH: Saudi Arabia plans to auction two major mining licenses in 2022 for commodities including gold, copper and zinc, as the Kingdom aims to triple the mining
sector’s contribution to the national gross domestic product (GDP) to SR240 billion ($64 billion) and double the number of jobs to 470,000 by 2030.
The auction was announced by Vice Minister for Saudi Mining Affairs Khalid Al-Mudaifer during an interview with S&P Global on the sidelines of the Gulf Petrochemicals and Chemicals Association (GPCA) Leaders Forum in Dubai this week.
Looking ahead, Al-Mudaifer said: “We expect to see an increase in international investment in mining, particularly because demand for minerals around the world is growing fast.
According to geological surveys dating back 80 years, the Kingdom has an estimated reserve of untapped mining potential valued at $1.3 trillion.” Saudi Arabia’s mining industry has already attracted some major foreign investors. American industrial corporation Alcoa has a 25.1 percent stake in two companies, Ma’aden Bauxite and Alumina and Ma’aden Aluminum, as part of $10.8 billion joint venture with the Saudi Arabian Mining Company (Ma’aden) located in Ras al-Khair Industrial City in the Eastern Province.
The Mosaic Company, a fertilizer producer, has a 25 percent stake in the $8 billion Ma’aden Wa’ad Al-Shamal Fertilizer Production Complex located in Wa’ad Al Shamal Minerals Industrial City in the north of Saudi Arabia. Furthermore, Barrick Gold has a 50 percent stake with Ma’aden in the Jabal Sayid underground Copper Mine and Plant.
Al-Mudaifer said that a new mining law, which came into force on Jan. 1, 2021, will help attract more foreign investors because it treats them equally with local investors.
“We have already received a number of applications for exploration licenses from locals and are also in conversations with a number of international mining businesses,” he said.
Speaking at the GPCA forum, Al-Mudaifer described how the Kingdom’s mining sector remained resilient throughout the pandemic.
“The government’s robust response to controlling the pandemic, paired with our thoughtful approach to executing the country’s mining strategy, has enabled us to continue moving forward with our industry transformation,” said Al-Mudaifer.
He also highlighted the launch of the National Geological Database, which provides online access to 80 years of national records of geological, geophysical and geochemical information, and the introduction of a new web-based platform called Ta’adin, which will be the single point of access for mining license applications, issuance and information.
Saudi Arabia plans to launch a comprehensive geological survey to map the country’s mining potential. “The mining sector recently invested $500,000 to launch our Regional Geological Survey Program, designed to collect the essential data required for mineral exploration in the Kingdom,” Al-Mudaifer told S&P Global.
“The five-year program will conduct geophysical and geo-chemical surveys and create detailed mapping of more than 700,000 square kilometers of the mineral-rich Arabian Shield area in Saudi Arabia,” he said.
The Vision 2030 reform plan identified the mining sector as a potential third pillar of the Kingdom’s industrial growth, alongside petroleum and petrochemicals. The country is investing SR14 billion to develop the sector.
“We have emerged more confident than ever that mining in the Kingdom is on the fast track to becoming the third pillar of Saudi industry.” the vice minister said.
About $45 billion in private and public sector investments have gone into the mining sector over the past decade, mainly in phosphate and aluminum production.
“Saudi Arabia has some of the world’s largest reserves of phosphate, and so we are investing in major phosphate projects such as Ma’aden’s large-scale phosphate complex, Phosphate 3,” Al-Mudaifer said.
The $6.4 billion Phosphate 3 expansion will make Ma’aden one of the top three global phosphate fertilizer producers and Saudi Arabia the second largest phosphate fertilizer exporter worldwide.


Saudi Arabia’s Public Pension Agency reports 9.5% return on investments in 2020

 Saudi Arabia’s Public Pension Agency on Sunday reported 9.5 percent returns on its investments in 2020. (Supplied)
Saudi Arabia’s Public Pension Agency on Sunday reported 9.5 percent returns on its investments in 2020. (Supplied)
Updated 17 min 4 sec ago

Saudi Arabia’s Public Pension Agency reports 9.5% return on investments in 2020

 Saudi Arabia’s Public Pension Agency on Sunday reported 9.5 percent returns on its investments in 2020. (Supplied)

RIYADH: Saudi Arabia’s Public Pension Agency on Sunday reported 9.5 percent returns on its investments in 2020.
A report carried by Argaam said the agency’s annual investment report showed PPA’s investments in 77 listed firms.
Al-Rai’dah Investment Co. (RIC), the agency’s investment arm, manages its investments.
The PPA’s investments are distributed in most countries, both in developed and emerging markets. The agency is also a strong investor in the Saudi market, which constitutes more than 50 percent of its portfolio.
The agency also invests in privatization programs, as they are considered attractive due to the diversity of its sectors.
Last year, PPA invested in 77 Tadawul-listed firms, four real estate funds, and 18 unlisted companies.
In 2020, the PPA invested in 18 new listed companies across 12 sectors, and two unlisted firms, according to the report.
During the coronavirus disease (COVID-19) pandemic, the agency invested in the technical sector, realizing gains of about 19 percent.
On June 15, the Saudi Cabinet approved the merger of PPA with the General Organization for Social Insurance (GOSI). The merger will result in the creation of one of the Kingdom’s largest investment funds estimated at billions of riyals.
The merger is aimed at unifying the public and private sectors’ insurance protection umbrella.
Nader bin Abdallah Al-Wahaibi, GOSI’s assistant governor for insurance affairs, was quoted by Argaam as saying that the merger will not affect the investment strategy, nor the stock exchange.
He said the merger will comprise transferring some of the ownerships from the PPA to GOSI, indicating that both institutions have a long-term investment strategy with investments in the same companies as well as business activities.


ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
Updated 01 August 2021

ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
  • With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ

RIYADH: Saudi Arabia’s Industrialization and Energy Service Co. (TAQA) on Sunday sold all its shares in Jubail Energy Services Co. (JESCO) to ArcelorMittal Tubular Products Jubail (AMTPJ).
With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ, TAQA said in an emailed statement, without disclosing the value of the deal.
Commenting on the sale of stocks, TAQA Chairman Ahmed Al-Zahrani said: “The divestiture of JESCO is in line with TAQA’s 2021 strategy to become a major player in Vision 2030 realization by maximizing the value of local investment and creating a more diverse and sustainable economy. The transaction will result in a much stronger industry in the steel sector serving not only the Kingdom but also the rest of the world.”
The company’s mandate is to lead the way in localizing industries in the Kingdom, supplying specialized equipment, and development of oil and gas resources in the Middle East and North Africa (MENA).
TAQA CEO Khalid Nouh said: “The divestiture of non-core businesses such as JESCO allows TAQA to expand its portfolio through acquisitions of additional services and technologies.” 


Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
Updated 01 August 2021

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
  • Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week

RIYADH: Bitcoin, the leading cryptocurrency in trading internationally, traded higher on Sunday, rising by 0.02 percent to $41,447.73 at 4:41 p.m Riyadh time.

Ether, the second most traded cryptocurrency, traded at $2,580.98.76, up 5.33 percent, according to data from Coindesk.

Here is a rundown of major crypto news:

Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week. The uptrend continues after the massive sell-off in May and two months of consolidation above the $30K support level, according to CoinDesk.

Germany plans to allow some institutional funds to invest billions of dollars in crypto assets for the first time, Bloomberg has reported.

A law effective Monday will allow so-called Spezialfonds with fixed investment rules to put up to 20 percent of their holdings in Bitcoin and other crypto assets. The funds, which can only be accessed by institutional investors, currently manage about $2.1 trillion.

“Most funds will initially stay well below the 20%,” said Tim Kreutzmann, an expert on crypto assets at BVI, Germany’s fund industry body.

In Ukraine, President Volodymyr Zelensky has signed the Law on Payment Services adopted by the Verkhovna Rada on June 30, the President's administration announced this week.

The new legislation aims to “modernize and further develop” the payment services market, and encourage innovation in the financial sector, according to a press statement.

The National Bank of Ukraine has also given the power to issue its own digital currency.

In an interview with Bloomberg on Thursday, Henri Arslanian, crypto leader at accounting and financial services firm PricewaterhouseCoopers (PWC), explained that crypto firms have high valuations due to the entry of major investors.

He mentioned investment firms and family offices are backed by major venture capitalists, private equity funds, and even some pension funds, and noted smaller venture capital firms are not satisfied with the trend.

Over to the US, Lael Brainard, a member of the Federal Reserve Board of Governors, highlighted the urgent need to develop a digital dollar, speaking to the Aspen Institute’s Economic Strategies Group on Friday.

He cited several reasons for creating a digital version of the US dollar, while the central bank agreed that it will have both international and domestic applications.


Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
Updated 01 August 2021

Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
  • The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties

RIYADH: The real estate price index in Saudi Arabia rose by 0.4 percent in the second quarter of 2021 compared to the same period of the previous year, official data showed on Sunday.
The statistics issued by the General Authority for Statistics showed a 0.8 percent increase in the residential real estate prices in the second quarter while prices of commercial and agriculture properties declined by 0.5 percent and 0.2 percent respectively.
The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties.
Meanwhile, the Wafi program, which regulates off-plan property activity in the Kingdom, issued a report highlighting its performance during the first half of the year.
Wafi issued 55 licenses for off-plan sales projects providing 24,328 housing units during the first half of 2021.
Off-plan property sales represent a growing sector of the Saudi real estate market, but some consumers are still wary of developers’ abilities to deliver quality homes on time.
The sector has been steadily increasing its share of total residential sales and data from the Wafi program.
According to real estate consultancy company, Knight Frank, off-plan units represent around 9 percent of total existing housing stock, but a massive 60 percent of total future supply in Saudi Arabia.
Saudi Arabia’s real estate sector is a key and effective economic driver for the country’s gross domestic product (GDP) and is connected to at least 120 industries.
Mortgage lending in Saudi Arabia increased 27 percent this year through May, as interest rates decreased to between 1 percent and 4.9 percent, compared to about 6 percent early last year.
Residential real estate financing contracts offered to individuals by local banks reached 133,006 through May, with a value of SR69.5 billion ($18.5 billion), according to data from the Saudi Central Bank (SAMA).
Real estate financing grew by 50 percent compared with the same period in 2020 when SR46.6 billion was lent via 104,000 contracts.


Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
Updated 01 August 2021

Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
  • Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion)

DUBAI: Saudi Arabia’s net foreign assets rose over 2 percent in June, as the global oil industry gradually recovers from the impact of COVID-19.

Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion) to 1.65 trillion riyals in June from the month before.

Total assets increased by 16.18 billion riyals to 1.842 trillion riyals, the central bank said.