Saudia Arabia and Egypt to play critical role in minerals drive to net zero

The critical minerals market is seeing unprecedented growth as clean energy demand drives a strong increase in investment, according to the International Energy Agency Critical Minerals Market Review released on 11th July 2023. The market for minerals that help power electric vehicles, wind turbines, solar panels and other technologies key to the clean energy transition has doubled in size over the past five year, with surging demand for minerals such as lithium, cobalt, nickel and copper.

The IEA aired concerns about the sufficiency and diversity of critical mineral supplies to meet future demand. This apprehension stems from various factors, including project development risks, market volatility, and geopolitical issues. Particular attention was drawn to supply concentration, with nations like China dominating certain critical mineral refining industries, while others, like the Democratic Republic of Congo, serve as primary sources of raw materials like cobalt.

The market for energy transition minerals reached US$320 billion in 2022 and is set for continued rapid growth, moving it increasingly to centre stage for the global mining industry. The IEA Report is putting a new focus on the critical minerals sector and this will culminate with the IEA’s Critical Minerals and Clean Energy Summit on 28 September.

The Middle East and North Africa will have a key role to play. Earlier this year, the UK and Saudia Arabia pledged to deliver closer co-operation on critical minerals. The partnership paves the way for the UK and Saudi Arabia to work together on diversifying sources of critical minerals, both through Saudi investment in the UK’s world leading manufacturing and mining finance sectors as well as new opportunities for UK mining firms to do business in Saudi Arabia. Saudi Arabia has one of the greatest untapped sources of critical minerals in the global market, worth circa US$1.3 trillion.

The UK and Saudi Arabia will explore working together to open up new sources of critical mineral supply. That could mean promoting the UK’s world leading manufacturing and mining finance sectors for Saudi investment or exploring new opportunities for UK mining firms to do business in Saudi Arabia.

The pledge builds on objectives already set out in the Critical Minerals Strategy, published in July 2022.

Egypt is home to a wealth of mineral resources including gold, copper, silver, zinc and platinum, in addition to other precious and base metals. Egypt has the potential to be one of the top mining locations in the world - Egypt as an Idealistic Mining Destination | Egypt Oil & Gas (egyptoil-gas.com)

The Egyptian mining sector set its plan to raise its contribution to the Egyptian economy through reforms and development plans, including new legislative amendments and available investment opportunities as well as issuing new bid rounds. The Egyptian Government is targeting the minerals sector to contribute 5% of GDP, given the huge untapped potential in the country.

The recent British Egyptian Business Association (BEBA) forum recently held in London included a plenary session on ‘Mining & Exploring the Egyptian Nubian Shield’. The session panel included a keynote presentation by HE Tarek El Molla, Minister of Petroleum and Mineral Resources. The BEBA event in London is being followed on by the second edition of the Egypt Mining Forum taking place on 18 - 19 July 2023 in Cairo. The Forum is hosted by the Ministry of Petroleum and Mineral

Resources and will bring together key regional stakeholders, international mining companies, and investors who are looking to do business in Egypt and North Africa.

HFI is looking forward to the formal roll out of our HFI Net Zero Legal Solutions initiatives in Saudia Arabia and Egypt and to supporting clients involved in the critical minerals sector.