Mining and metals
With the largest known deposits of mineral resources in the Middle East, mining and metals processing in KSA is a new growth area and as such, a lucrative target for investment.
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Strong demand for metal
Reformed mining regulations, cheap energy and a domestic construction boom are transforming the mining and metals processing industry across Saudi Arabia.
While industrial booms in China and elsewhere have generated worldwide increases in the price of many commodities, homegrown construction booms in Saudi Arabia and across the Middle East enhance the attractiveness of local mining and metals processing. Steel, for example, enjoys very strong demand in the region thanks to the construction of the Economic Cities and other major development projects.
Saudi Arabia’s vast mineral resources include bauxite, phosphates, zinc, copper and gold. Meanwhile, the low cost of energy in KSA provides distinct advantages to steel producers as well as other energy intensive operations. For example, a multi-billion dollar initiative is currently underway to develop Saudi Arabia’s aluminum sector.
New mining code
KSA’s New Mining Code will open up the nation’s reserves, lowering costs and making extraction easier. Mineral investors will also enjoy a 20% reduction in their tax liability. With proven resources including 20 million tons of gold ore and 60 million tons of copper, Saudi’s vast, unexplored landmass provides excellent exploration potential.
Good reasons to invest
- Well documented rich deposits of minerals including bauxite, phosphates, zinc and copper
- Strong domestic and international trend are supporting high prices
- Availability of competitive, low-cost energy and gas for processing
- The New Mining Code provides greater transparency and lower costs, equal treatment of foreign investors and fewer obstacles to the development of new mines and related industries
- Establishment of Mining Investment Services Center to support the development of the sector
- Government support for mineral developments
- Reduction of tax liability of 20% for mineral investors
- Competitive 30-year mining licenses
- First-mover advantages for players willing to establish a presence in this young industry