Sa'udi Arabia - Mining



Oil continued to dominate Sa'udi Arabia's mining sector—the country supplied 12.3% of the world's crude oil output in 2000, petroleum and petroleum products accounted for 90% of the country's export earnings in 2002 and 70% of government revenues, and crude oil and natural gas accounted for 42% of GDP; other minerals contributed 0.4% of GDP. Sa'udi Arabia has nevertheless diversified by expanding its gold production in recent years, as well as production of cement, fertilizer, petrochemicals, and steel. Cement production, construction, and fertilizer manufacturing ranked fourth, fifth, and sixth, respectively, among the country's leading industries in 2002.

Production of ore concentrate and bullion (metal content) in 2000 included copper, 900 tons, up from 821 in 1999; gold, 3,800 kg, down from 7,530 in 1996; and silver, 9,300 kg, down from 17,200 in 1997. In 2000, the country also produced lead, zinc, barite, basalt, clays, phosphatic fertilizer, granite, gypsum, lime, limestone, marble, nitrogen, nitrogenous fertilizers, pozzolan, salt, sand and gravel, silica sand, scoria, sodium hydroxide (caustic soda), and sulfur. Mining operations continued at the ancient gold and silver underground mine Mahd adh-Dhahab (literally, "cradle of gold"), which was located southeast of Medina and probably dated from the time of King Solomon (10th century BC ). Other gold producers were the open-pit silver and gold Amar Mine, southwest of Riyadh, which began operations in 2000, and the Sukhaybirat surface mine, northwest of Riyadh.

Feasibility studies at Balghah estimated resources to be 40 million tons at a grade of 1 grams per ton of gold. The remote Zabirah bauxite deposit had minable resources of 102 million tons. About 3,000 showings for at least 50 metallic and nonmetallic minerals have been located. Substantial national reserves of gold, iron ore, silver, copper, zinc, lead, pyrites, phosphate, magnesite, barite, marble, and gypsum have been suspected, and an intensive search was being carried on by Sa'udi and foreign companies.

All minerals, including petroleum and natural gas, were owned by the government. A modern mining code encouraged foreign participation, although majority holdings by national interests have increasingly been stressed. The Foreign Investment Act of 2000 gave international investors the same rights and privileges as Sa'udi investors. The government was also considering a revised mineral policy to attract additional investment in the mining sector. In 2000, the government established the Supreme Council for Petroleum and Mineral Affairs. The state-owned Sa'udi Arabian Mining Co. (Ma'aden) was created in 1997, and participated actively in and promoted mineral exploration and mining activities throughout the kingdom. Several metal and industrial mineral mining projects were expected to come onstream within the next 10 years.

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