Saudi Arabia agrees metals deals worth over $9 billion
Business
Saudi Arabia agrees metals deals worth over $9 billion
RIYADH (Reuters) - Saudi Arabia on Tuesday agreed to nine investment deals in metals and mining worth more than 35 billion riyals ($9.32 billion) with companies including India's Vedanta and China's Zijin Group.
The deals were announced during the World Investment Conference in Riyadh by the Global Supply Chain Resilience Initiative, a government programme under the Saudi government's National Investment Strategy.
The kingdom's growing mining industry is part of the Vision 2030 plan to diversify the economy and cut reliance on fossil fuels. The government hopes to attract $100 billion a year in foreign investment under the plan by 2030, achieving just over a quarter of that last year.
Oil to metals conglomerate Vedanta will build copper facilities with a capital expenditure of 7.5 billion riyals at Ras Al-Khair, a conference presentation showed, including a smelter and refinery with a capacity of 400,000 metric tons per annum (tpa) and a 300,000 tpa copper rod plant.
The project will ensure domestic self-sufficiency in copper production and contribute an estimated 70 billion riyals to economic growth, according to the presentation.
Vedanta is interested in investing in Saudi Arabia because of the available incentives - including land, water and power services - as well as potentially being able to tap into a lower cost of capital there, the company's base metals CEO Chris Griffith told Reuters.
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"There's some (incentives) that are fairly obvious and there's some that are less obvious that we're working with the Saudi government on now," Griffith said, adding that Vedanta may consider taking on a local partner to help advance the projects.
Zijin will invest 5 billion to 6 billion riyals, with a first phase focused on building a zinc smelter with a capacity for 100,000 tpa of zinc ingots and 200,000 tpa of sulphuric acid.
A second phase will see the construction of a lithium carbonate extraction facility to produce 60,000 tpa of battery-grade lithium carbonate, and in the final phase, a copper refinery will be built with an output of 200,000 tpa of copper cathodes and about 50,000 tpa of electrolytic copper foil.
Australia's Hastings Technology Metals will build processing facilities for rare earth elements in several phases for a total investment of 5.6 billion to 7.2 billion riyals.
The phases include a hydrometallurgical processing plant, a solvent extraction separation facility, a rare earth elements downstream processing facility, and sourcing rare earth elements from mines in Saudi Arabia.
Vancouver-based Platinum Group Metals is conducting studies with local firm Ajlan & Bros Mining to build a 1.9 billion riyal platinum group metals smelter and base metals refinery. Feedstock will come from South Africa's Waterberg mine, which the Canadian group is developing.
