Mineral wealth leads global lab to open in Saudi Arabia

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• Global company expands to Jeddah
• Mining worth $36bn a year
• Saudi Arabia ‘a key market’

The drive to exploit Saudi Arabia’s estimated $2.5 trillion of untapped mineral wealth has moved another step forward with the opening by the global laboratory testing company Bureau Veritas of a new metal and minerals facility in Jeddah.

“Saudi Arabia is one of our key markets. It’s fast growing and that’s what makes it quite special,” said Hinda Gharbi, CEO of Bureau Veritas.

“Saudi Arabia is really trying to develop a mining industry. It’s been a producer of gold and copper for a while but they really want to scale this up. We will be bringing more capacity to the country and allowing them to be more efficient and have the right experts for this testing.

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“During exploration they get rock materials, we analyse it and give them an idea of the minerals they have. Based on that they try to understand the ore they are mining, they make a decision on the viability of their projects,” Gharbi said.

The Saudi industry and investment ministries have launched a mineral exploration incentives package, valued at $182 million. Exploration permits rose to 259 in 2023 from 58 in 2021 and building material quarry licences rose threefold to 538.

This month the London Metal Exchange, the world’s biggest exchange, added Saudi Arabia’s Jeddah Islamic Port to its list of locations for the storage of copper and zinc, making Jeddah only the second regional location after Dubai. 

Saudi Arabia is bidding to become the Middle East’s main logistics centre and a global player in mining, led by the country’s largest mining company, Maaden, which is 50 percent owned by the government.

The kingdom has the world’s seventh largest mining industry, at $36.3 billion a year, well behind the number one mining nation, China, at $217.8 billion.

Marc Ostwald, chief economist at ADM Investor Services International, based in London, said the LME listing and new laboratories were part of a long-term strategy of building up the mining sector. 

“This is all part of a process of strengthening the domestic supply and production chain, in the broader context of building up the non-oil sector,” he said.

“It’s very important to ensure that major projects such as Neom are not fulfilled by a flood of imports of everything from raw materials to finished goods.”