Saudi strategy will make KSA a mining hub, industry pundits believe

Saudi strategy will make KSA a mining hub, industry pundits believe
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Updated 06 February 2022

Saudi strategy will make KSA a mining hub, industry pundits believe

Saudi strategy will make KSA a mining hub, industry pundits believe
  • “There are over $3-trillion worth of minerals to be exploited in the Kingdom, which opens huge opportunities for minerals companies”

RIYADH: Saudi Arabia has in recent years been under scrutiny as a major player in the oil-based carbon economy, but it is now drawing praise for its strategic shift towards the discovery and extraction of minerals and metals.

In an online media session to discuss the implications of the Kingdom’s new mining regime, global industry leaders and specialist lawyers were unanimous in their positive view of Saudi Arabia’s anticipated role in a more sustainable global economy.

This conversation was held in the context of the Kingdom’s Mining Law of 2020 and, more recently, the Future Mining Forum, FMF, a convening of political and business leaders held in Riyadh from Jan. 11 to 13.

Ernst Muller, a South African lawyer specializing in natural resources law and environmental, social, and governance framework, known as ESG, began the discussion by pointing out that, “a global transition to new energy sources” is underway and that “the FMF was focused on what countries should be doing and what role mining companies should have in this shift.”

Peter Leon, a partner in Johannesburg-based law firm Herbert Smith Freehills, who also advised Saudi Arabia’s Ministry of Industry and Mineral Resources, MIMR, on the drafting of its new Mining Law, said that this transition “has big implications for the world mining industry.




Peter Leon

“All new technologies — wind, solar, electric vehicles, whatever — need specific minerals including lithium, cobalt and rare earth minerals. The Kingdom is rich in these and in many others.

“The World Bank recently reported that over 3 million tons of minerals and metals will be needed in the coming transition. That represents a 500 percent increase in demand for minerals. But it also means a huge supply gap.

“There are over $3-trillion worth of minerals to be exploited in the Kingdom, which opens huge opportunities for minerals companies.”

Muller described the global move to de-carbonization as “a table with three legs: First, the desire to move to sustainability; second, the minerals needed for that process; and third, an environment conducive to investment.”

All new technologies — wind, solar, electric vehicles, whatever — need specific minerals including lithium, cobalt and rare earth minerals. The Kingdom is rich in these and in many others

Peter Leon, a partner in Johannesburg-based law firm Herbert Smith Freehills

FMF came at the right time

Aldo Pennini, FMF Program Director and a corporate affairs and reputation management consultant, observed that both governments and miners “really need to reimagine the minerals industry. There is a collective desire to take action. There is a historic nature to this conversation.”

Leon added, “the Kingdom must be credited for making that conversation happen. The FMF was an important gathering to talk about the global future of mining. This was not just commercial. It was about much wider issues.

“I have two takeaways: First, the need for collective action; and second, how Saudi Arabia could be a regional mining hub for the Middle East but also for Africa.”

Sheila Khama, a Botswana-based mining consultant who was previously CEO of De Beers Botswana and a policy adviser to the World Bank and African Development Bank, pointed out that “there is an onus on governments to attract and retain investments, meaning a regulatory framework that speaks to companies and investors. The new Saudi mineral law is on track in this regard.”

Mining Industry challenges

On the other hand, according to Khama, “the mining industry needs to ramp up its communications. There’s a disconnect between the contribution of minerals to decarbonization, and the public mindset. To be able to transition we need a huge amount of minerals. Recycling just won’t be enough. And these facts need to be communicated to the general public.”

Michael Naylor, managing director and CEO of the Western Australia-based miner EV Metals Group plc, noted “$1 trillion has been invested globally in the production of EVs and batteries, but there is a lacuna in terms of the delivery of minerals to these giga factories.

“The supply is simply not there to support their growth plans. And we cannot afford failure in this transition.”

Turning challenges into opportunity

Pennini sees this as a long-term opportunity for Saudi Arabia and its Gulf neighbors. “The World Bank estimates that 75 percent of mining exploration investment goes into only 10 countries”, he observed, “and this does not include any Gulf countries. So what needs to happen?”

Leon commented that the Kingdom has taken two concrete steps in this regard: first, by investing $250 million on the Saudi Geological Survey to identify new mineral sources across the Kingdom, accompanied by a geological database with 80 years-worth of geological information. And second, by implementing the new Mining Law.

Saudi mining law

In terms of the latter, Leon said, “the mining industry needs regulatory certainty, strong rule of law and simple online application systems.

“When drafting the new law, we had a mandate from the MIMR: to follow global best practices regarding legal clarity, environmental responsibility, health and safety issues, effective dispute resolution and a fair licensing regime. Our guidelines gave effect to all of that.”

“The new law provides certainty of tenure for miners, a simple application process and a competitive timeframe for applications.”

With respect to environmental and social issues, Leon said, “mining licensees must have a plan for ESG.”

$1 trillion has been invested globally in the production of EVs and batteries, but there is a lacuna in terms of the delivery of minerals to these giga factories

Michael Naylor, managing director and CEO of the Western Australia-based miner EV Metals Group plc

Vis-a-vis dispute resolution, Leon pointed out that “Saudi Arabia’s new legislation goes beyond more developed mining jurisdictions (the previous gold standard being the Western Australian Mining Act of 1977). It is possible for mining companies to take the Kingdom to arbitration, with the previous consent of the Minister of MIMR.

“Moreover, Saudi Arabia has ratified bilateral treaties with numerous countries including Japan, South Korea, China and various European states, which provide an automatic recourse to international arbitration” in the event of a dispute between a mining company and the Saudi Government.

And in terms of the licensing regime, Leon added, “The MIMR is now legally under obligation to issue licenses within a defined timeline. In Western Australia, it takes six months to process a mining application, while in the KSA this is now 90 days. And the process is reliable and transparent.

“The new law will accelerate the development of the Kingdom’s mining sector”, Leon said. “And that needs to be communicated to international investors.”

Saudi offers what other lack

The speakers agreed that Saudi Arabia is especially well-positioned as a minerals supplier in view of wider geo-political factors.

“A lot of minerals are located in ‘difficult’ countries”, Leon observed. “These are often challenging environments with serious rule-of-law issues.

“And Lima, Peru and Chile have voted in leftwing presidents, so all bets are off regarding their new mining codes.”

There is an onus on governments to attract and retain investments, meaning a regulatory framework that speaks to companies and investors. The new Saudi mineral law is on track in this regard

Sheila Khama, a Botswana-based mining consultant who was previously CEO of De Beers Botswana

Pennini added that “there is very little exploration (for new minerals) being carried out in the developing world.”

And Naylor pointed out that, “the world needs more lithium – but it doesn’t want more lithium mines” – as indicated by public resistance to mining in many EU states.

Leon also noted, “Saudi Arabia’s corporate tax rate is 20 percent of profits, plus zakat of 2.5 percent” – relatively low by global standards.

In all these respects, the participants agreed, the KSA is doing the right thing, making the right investments and it is well placed for the future of the mining industry.

“The process is reliable and transparent”, Naylor said, “and there is a reasonable timeframe within which to work, which is crucial. The Kingdom is displaying leadership in the mining sector. Please continue these conferences. Kudos to Saudi Arabia’s Minister of mining and industries.”


Oil rises as tight supply trumps recession fears

Oil rises as tight supply trumps recession fears
Updated 04 July 2022

Oil rises as tight supply trumps recession fears

Oil rises as tight supply trumps recession fears
  • OPEC misses target to boost output in June: Survey

LONDON: Oil rose on Monday as supply concerns driven by lower OPEC output, unrest in Libya and sanctions against Russia outweighed fears of a demand-sapping global recession.
Eurozone inflation hit yet another record high in June, strengthening the case for rapid European Central Bank rate increases, while US consumer sentiment hit a record low.
Brent crude rose $2.26, or 2 percent, to $113.89 a barrel by 12:47 p.m. ET (1648 GMT) after falling more than $1 in early trade. US West Texas Intermediate crude rose $2.20, or 2 percent, to $110.63, in thin volume during the US Independence Day holiday.
The Organization of the Petroleum Exporting Countries missed a target to boost output in June, a Reuters survey found.
In OPEC member Libya, authorities declared force majeure at Es Sidr and Ras Lanuf ports as well as the El Feel oilfield on Thursday, saying oil output was down by 865,000 barrels per day.
Meanwhile, Ecuador’s production has been hit by more than two weeks of unrest that has caused the country to lose nearly 2 million barrels of output, said state-run oil company Petroecuador.
Adding to potential supply woes, a strike this week in Norway could cut supply from Western Europe’s largest oil producer and reduce overall petroleum output by about 8 percent.
“This backdrop of mounting supply outages is colliding with a possible shortage in spare production capacity among Middle Eastern oil producers,” said Stephen Brennock of oil broker PVM, referring to the limited ability of producers to pump more oil.
“And without new oil production hitting markets soon, prices will be forced higher.”

British PM
British Prime Minister Boris Johnson on Monday called on the OPEC+ producer group to produce more oil to tackle a cost-of-living crisis.
Brent crude has come close this year to topping the 2008 record high of $147 a barrel after Russia’s invasion of Ukraine added to supply concerns.
Soaring energy prices on the back of bans on Russian oil and reduced gas supply have driven inflation to multi-decade highs in some countries and stoked recession fears.


Egypt In-Focus — Suez Canal’s revenues rise 20.7%; efforts on to develop sustainable transport sector

Egypt In-Focus — Suez Canal’s revenues rise 20.7%; efforts on to develop sustainable transport sector
Updated 04 July 2022

Egypt In-Focus — Suez Canal’s revenues rise 20.7%; efforts on to develop sustainable transport sector

Egypt In-Focus — Suez Canal’s revenues rise 20.7%; efforts on to develop sustainable transport sector

CAIRO: Egypt’s Suez Canal’s revenues increased 20.7 percent during the fiscal year 2021/22. The Ministry of International Cooperation has received $2.4 billion from bilateral and multilateral partners over the past two years for the development of sustainable transport sector.

Suez Canal

Suez Canal’s revenues increased by 20.7 percent during the fiscal year 2021/22, compared to the year earlier, to reach $7 billion, Asharq Al-Awsat reported citing Suez Canal Authority Chairman Osama Rabea.

Egypt’s fiscal year runs from July 1 to June 30.

Sustainable transport sector 

Egypt is working to provide development funds and technical support from multilateral and bilateral development partners in a bid to develop the transport sector, Asharq Al-Awsat reported citing the minister of international cooperation.

Rania Al-Mashat was quoted as saying that over the past two years, the ministry has received around $2.4 billion for the sustainable transport sector from the European Investment Bank, the French Development Agency, the European Bank for Reconstruction and Development, China, and the Kuwait Fund for Arab Economic Development.

BNPL service

Amazon Egypt has launched its buy now, pay later fintech platform valU, as part of its commitment to enhance shopping experience in the north African country and offer customers affordable and flexible payment options. 

 


Boubyan Bank and Visa celebrate launch of World Cup Qatar 2022 Prepaid Card

Boubyan Bank and Visa celebrate launch of World Cup Qatar 2022 Prepaid Card
Updated 04 July 2022

Boubyan Bank and Visa celebrate launch of World Cup Qatar 2022 Prepaid Card

Boubyan Bank and Visa celebrate launch of World Cup Qatar 2022 Prepaid Card
  • The card includes many events, exclusive discounts and offers for Visa cardholders

KUWAIT: Boubyan Bank and Visa announced the launch of Boubyan’s Visa FIFA World Cup Qatar 2022 Prepaid Card on Friday.

The launch event was attended by partners, media professionals, social media influencers, and bank customers.

“It is no secret that Kuwait, the region and the whole world are passionate about football,” Abdullah Al-Mejhem, Chief Private Banking and Consumer Banking, said.  “The fact it will be held in a GCC country makes us at Boubyan Bank proud of how far we have come as a region and our partnership with Visa.”

He continued: “We take pride in our collaboration with Visa in this special launch of Boubyan Visa Prepaid Card along with its various benefits. I would like to seize this opportunity to reiterate the importance of our special partnership with Visa that dates back to many years, and which, thank Almighty Allah, introduced outstanding services to better serve our customers of all segments.

“Boubyan Bank is keen on changing traditional concepts about banking products and services out of its endeavors to become a “Way of Life” and to be always closer to customers. This can be clearly seen through our constant tracking of sports’ activities, especially popular sports such as football.”

At the event, customers enjoyed the activities and many benefits such as being issued the card with no fees.

“We are proud to join our longstanding partner Boubyan Bank in offering football fans in Kuwait access to the digital economy through secure and rewarding digital payment solutions. These FIFA-themed Visa prepaid cards are contactless enabled for quick and easy payments in store and backed by Visa’s security technology so cardholders can pay with confidence. For travelers, they also promise the peace of mind of worldwide acceptance at our 100 million merchant partner locations” Shashank Singh, Visa’s General Manager for Kuwait and Qatar, said.

“There is no doubt that the FIFA World Cup ™ is an international event that draws the attention of people around the world for more than one month. This time, the event enjoys a special importance since it will be held very near to us, an hour away, which gives it more focus and attention.” Yousef Al-Majed, the bank's Executive Manager, stated.

According to Al-Majed, the card's design includes many events, exclusive discounts and offers for Visa cardholders, as well as the ability to use it with all modern payment Apps and smart wearables.

“The card is easily available for all Boubyan Bank’s customers. It is a limited edition, which gives it more glamour and importance. Customers can get the card through Msa3ed, our digital assistant on Boubyan App, or through any of Boubyan Bank’s branches, where they can apply for the card and choose whether the card be delivered to their homes within 5 business days, or to receive the card from any branch within 3 business days.” he pointed out.

“This ceremony comes as a part of the campaign organized by the bank for this card, which started months ago, including the organization of Boubyan Football Cup during the Holy Month of Ramadan. The coming period will witness many events to be announced in due time through our social medial platforms as a part of the marketing campaign for the card,” Al-Majed concluded.


OPEC+ must produce more oil, says British premier

OPEC+ must produce more oil, says British premier
Updated 04 July 2022

OPEC+ must produce more oil, says British premier

OPEC+ must produce more oil, says British premier

LONDON: British Prime Minister Boris Johnson said on Monday OPEC+ must produce more oil to try to tackle a growing cost-of-living crisis and bring down prices.

“There is no doubt that we are going to need a lot more OPEC+ oil,” he told parliament, referring to a group that includes Saudi Arabia, Russia and other major oil producers.

“The UK has ... strong and productive relations with Saudi Arabia. We need to make sure the whole of the West does as well,” Johnson said, adding that Saudi Arabia needed to produce more oil. 


NRG Matters: Australia, India agree to strengthen clean energy deal; EU plan hydrogen deal with Namibia


NRG Matters: Australia, India agree to strengthen clean energy deal; EU plan hydrogen deal with Namibia

Updated 04 July 2022

NRG Matters: Australia, India agree to strengthen clean energy deal; EU plan hydrogen deal with Namibia


NRG Matters: Australia, India agree to strengthen clean energy deal; EU plan hydrogen deal with Namibia


RIYADH: On a macro level, Australia and India have agreed to a partnership to strengthen a clean energy deal. Zooming in, France’s Technip Energies has been awarded a contract to build the first carbon capture and storage project in the world. 

Looking at the bigger picture

• The EU is planning a deal with Namibia to support the country’s emerging green hydrogen sector and boost its own imports of the fuel, Reuters reported citing EU and Namibian officials.

It is part of the bloc efforts to reduce its dependence on Russian energy.

• Australia and India have agreed to a partnership to strengthen a clean energy deal, according to Reuters. 

The two countries agreed to cooperate in developing critical metal projects and supply chains.

Through a micro lens

• French engineering and technology firm for the energy industry Technip Energies has been awarded an engineering, procurement and construction contract for the world’s first carbon capture and storage project.

Awarded by Hafslund Oslo Celsio, the project is for a supplier of district heating in Norway, and will be the first full-scale waste-to-energy plant in the world with carbon dioxide capture, Trade Arabia reported.