Saudi Arabia’s Rare Earth and Critical Minerals Strategy (Vision 2030)

Highlights

• Saudi Arabia is aggressively expanding its mining sector to diversify its economy, valuing its mineral wealth at $2.5 trillion and targeting rare earth elements and battery metals.
• The kingdom is pursuing strategic international partnerships with global mining companies from China, USA, Australia, and Canada to develop processing capabilities and critical mineral supply chains.
• Saudi Arabia aims to become a geopolitically neutral link in global mineral supply chains, investing $100 billion in mining by 2035 and developing downstream manufacturing capabilities.

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Saudi Arabia is aggressively expanding its mining sector to diversify its economy under Vision 2030. The kingdom has rapidly upgraded its resource estimates – the government now values Saudi Arabia’s identified mineral wealth at about $2.5 trillion (up from $1.3 trillion in 2016), as reported (opens in a new tab) in S&P Global. This surge is largely due to newly “discovered rare earth elements and transitional metals”. Rare earths (REEs) – a group of 17 chemically similar metals used to make high-performance magnets, batteries, and electronics – are especially prized. For example, as reported by Reuters (opens in a new tab) and Rare Earth Exchanges (REEx), Saudi officials note that rare earths can be “used to make magnets that turn electricity into motion for EVs, cell phones and other devices”. In short, developing REEs is central to Saudi goals of building local industries (e.g., electric vehicles, renewable energy, high-tech manufacturing) instead of exporting raw oil.

Much of this push has been driven by Vice‐Minister of Industry and Mineral Resources for Mining Affairs Khalid bin Saleh Al-Mudaifer (opens in a new tab) and other leaders in government, who have outlined sweeping reforms, investment initiatives, and projects. Al-Mudaifer frequently emphasizes that” Vision 2030 economic diversification.  Saudi Arabia has set up state-backed Ma’aden (opens in a new tab) (1211.SE) (opens in a new tab), also known as Saudi Arabia Mining Co,  formed as a Saudi joint stock company on 23 March 1997 for the purpose of facilitating the development of Saudi Arabia’s mineral resources.

In interviews and public forums, Al-Mudaife has championed major milestones. For instance, he announced in early 2025 that Saudi Arabia would mobilize SR375 billion ($100 billion) in new mining investments by 2035 (with SR75bn already committed). He also spearheaded a feasibility study (announced late 2023) on launching a commodity exchange for battery materials – including graphite and rare earths (opens in a new tab) – to bring transparency to these markets. As Al-Mudaifer explained, “to be a minerals hub you have to have it all”, and the kingdom is even considering an exchange for REEs, lithium, cobalt, and nickel.

Al-Mudaifer’s office has driven regulatory and incentive reforms, too. The 2020 Mining Investment Law was overhauled to attract foreign and private investment, and the Ministry of Industry and Mineral Resources has issued hundreds of exploration licenses (see Timeline below).

Al-Mudaifer often notes that the surge in exploration activity – Saudi exploration spending has risen ~32% annually, much faster than the global average (opens in a new tab) – is producing results: dozens of new discoveries (gold, phosphate, copper, lithium, etc.) and higher valuations. In short, Al-Mudaifer is a key public face of Saudi mining policy, authorizing deals and speaking alongside international partners from Davos to the BMO conference in Miami (Feb 2025) about Saudi investment opportunities.

Timeline of Milestones and Partnerships

• Jan 2023 – Manara Minerals JV formed (opens in a new tab): The sovereign Public Investment Fund (PIF) and state-owned miner Ma’aden created Manara Minerals, a mining investment JV. Manara’s first major deal was a 10% stake in the copper-nickel unit Vale Base Metals (valued at $26 billion), giving Saudi Arabia exposure to one of the world’s largest copper/nickel assets.
• Nov 2023 – Rare Earth Exchange Study: Vice-Minister Al-Mudaifer announced (in a Reuters interview (opens in a new tab)) that Saudi was studying a commodities trading platform for battery materials – including graphite and rare earths. He noted challenges (small volumes, varied specifications) but emphasized the goal of becoming a minerals hub with efficient price mechanisms.
• Dec 2024—Lithium from Brine: Ma’aden announced (opens in a new tab) a breakthrough in extracting lithium from seawater, signaling Saudi Arabia’s broader ambitions in battery metals (though commercial viability is pending).
• Jan 2025 – $100 Billion Mining Plan: At the BMO Global Metals, Mining & Critical Minerals Conference (opens in a new tab) in Miami, Al-Mudaifer unveiled a SR375 billion (~$100 billion) investment program for mining by 2035. He stated that SR75 bn had already been allocated to projects, underscoring strong momentum.
• Mar 2025 – Exploration Licenses Awarded: Saudi Arabia awarded new mining exploration licenses covering 4,788 km² (see Table 1) to both domestic and international firms. As covered by Reuters, these included India’s Vedanta Ltd, which won a copper/zinc license at Jabal Sayid, and a consortium of local Ajlan & Bros plus China’s Zijin Mining won a license at Al-Hajar (Aseer). These initial licenses are expected to spur SR366 million ($97.6m) in exploration spending over three years, as reported by Reuters (opens in a new tab).
• Apr 2025—Rare-Earth Processing Partnership Search: Reuters reported that Ma’aden was negotiating with four specialized firms to build a domestic rare-earth processing (and ultimately magnet-making) plant. The candidates are U.S. MP Materials (opens in a new tab), China’s Shenghe Resources (opens in a new tab), Australia’s Lynas Rare Earths, (opens in a new tab) and Canada’s Neo Performance Materials (opens in a new tab). Ma’aden plans to select one or more partners by mid-2025, with feasibility studies on extraction and refining to be completed by year-end.
• Apr 2025 – Aramco – BYD Joint Development: Saudi Aramco (through its technology arm, SATC) signed a Joint Development Agreement with China’s BYD on April 21, 2025. Note: BYD is the world’s largest electric vehicle manufacturer.  This collaboration, aimed at improving electric-vehicle efficiency and lowering emissions, combines Aramco’s energy R&D with BYD’s EV/battery expertise. It underscores Saudi Arabia’s push into the EV supply chain: the kingdom aims to raise EV adoption from ~1% to 30% in five years.
• May 2025 – Saudi-US Mineral Cooperation Talks: As reported in Reuters and in Rare REEx, on May 6, 2025, Reuters reported that the Saudi cabinet authorized discussions with the U.S. on a mining and minerals cooperation agreement. The MoU – to be negotiated between Saudi Arabia’s Industry & Mineral Resources ministry and the U.S. Department of Energy – is slated to cover joint exploration, technology transfer, and supply-chain security. These talks are timed ahead of a planned visit by U.S. President Trump (under a second Trump administration scenario), reflecting a mutual interest in diversifying non-China critical-mineral supply lines.

Table 1 belowsummarizes recent key deals, MOUs and programs. The next section discusses these international partnerships in more detail.

Aramco Technologies (SATC) & BYD (China)

Date	Participants/Companies	Project/Deal	Notes
2023	PIF & Ma’aden (Saudi) with Vale (Brazil)	Rare-earth processing MOU	First foreign investment by Manara. Acquired 10% of Vale’s $26bn copper-nickel unit
11-2024	Hastings Tech Metals (Australia) & NIS (KSA)	Nonbinding MOU to explore a lithium hydroxide refinery in Saudi Arabia	Nonbinding MOU to study building a REE processing facility in Saudi Arabia. Part of the broader Raw Materials Strategy
11-2024	Critical Metals (USA) & Obeikan Group (Saudi)	Lithium MOU	The Cabinet authorized the draft MoU on mining/mineral resources. Aimed at technology transfer and securing critical supply chains
03-2025	Saudi Ministry (SPA report) with Vedanta (Ind.), Ajlan & Bros + Zijin (China)	Exploration Licenses at Jabal Sayid & Al-Hajar	Licenses covering 4,788 km² (Madinah/Aseer). Firms must invest ~SR366m in exploration
04-2025	Ma’aden (Saudi) with MP Materials (USA), Shenghe (China), Lynas (Aus), Neo (Can)	REE processing partnership selection	Ma’aden shortlists four foreign rare-earth firms. To select partner(s) by June 2025 for a downstream processing (and magnet) plant
4-2025	Aramco Technologies (SATC) & BYD (China)	EVD Technology/JDA	V Agreement to collaborate on new energy vehicle tech, improving efficiency and lowering emissions
05-2025	Saudi Ministry & U.S. DOE (planned)	Minerals Cooperation Mo	Cabinet authorized draft MoU on mining/mineral resources. Aimed at technology transfer and securing critical supply chains

International Partnerships and Deals

Saudi Arabia has pursued strategic partnerships with global mining companies and countries to build its critical minerals supply chain:

Nation	Summary
China	Saudi ties with Chinese firms are expanding. In 2023, a Saudi consortium awarded a license to Zijin Mining for copper/zinc exploration. China’s state geological survey has also been mapping Saudi’s mineral deposits since 2023. In the downstream sector, Saudi’s Aramco signed the April 2025 EV tech deal with BYD (see above). Saudi Arabia is also negotiating REE processing with China’s Shenghe Resources. Conversely, Beijing is wary of losing its market share: in April 2025 China banned some rare-earth processing exports and tightened controls on finished magnets. These tensions make diversification urgent for Saudi.
USA	Saudi Arabia is courting U.S. firms and government support. A clear signal was the planned Saudi–U.S. mining MoU (May 2025) with the Department of Energy, potentially covering joint exploration and advanced mining tech. Saudi’s flagship Ma’aden is in talks with U.S.-based MP Materials (owner of the Mountain Pass rare-earth mine) to co-develop a Saudi REE plant. Manara Minerals’ PIF partner is increasingly active: in late 2024 PIF-backed Manara was reported bidding for a major cobalt-nickel project abroad. Also, Saudi funds have expressed interest in Canadian mining (see below) and are exploring U.S. lithium and battery ventures. Notably, the PIF is the largest shareholder in Tesla competitor Lucid Motors, which opened an EV plant in Saudi Arabia in 2023, underpinning Saudi demand for battery metals.
Australia/Canada	Australia’s Lynas Rare Earths (the world’s second-largest REE refiner) is in Ma’aden’s short list, and mining firm Hastings Tech has already signed an MOU for a Saudi rare-earth facility. Australian base-metals miners are also partnering with Saudi PIF (e.g., copper smelter investment with Vedanta, financed by Saudi programs). On the Canadian side, Neo Performance Materials is short-listed for the REE partnership. In October 2024, Industry Minister Bandar al-Khorayef said Saudi state funds were seeking equity stakes in Canadian mining companies to gain access to technology and resources as reported in Arab News. These efforts build on recent reconciliation of Saudi-Canada relations, with MOUs signed to encourage Canadian expertise in Arabian deposits (particularly copper and critical minerals).
Other International Collaborations	Australia’s Lynas Rare Earths (the world’s second-largest REE refiner) is in Ma’aden’s short list, and mining firm Hastings Tech has already signed an MOU for a Saudi rare-earth facility. Australian base-metals miners are also partnering with Saudi PIF (e.g., copper smelter investment with Vedanta, financed by Saudi programs). On the Canadian side, Neo Performance Materials is short-listed for the REE partnership. In October 2024, Industry Minister Bandar al-Khorayef said Saudi state funds were seeking equity stakes in Canadian mining companies to gain access to technology and resources, as reported in Arab News. These efforts build on recent reconciliation of Saudi-Canada relations, with MOUs signed to encourage Canadian expertise in Arabian deposits (particularly copper and critical minerals).

Taken together, these partnerships illustrate Saudi Arabia’s strategy of leveraging foreign expertise and capital. The choice of partners often reflects Saudi’s geopolitical balancing act: it courts both Chinese and Western firms while positioning itself as a neutral “link” in critical minerals (a theme noted by analysts at SWP-Berlin (opens in a new tab).

Domestic Mineral Resources and Capacity

Geology and Reserves: The kingdom’s geology is very promising. Most deposits lie in the western Arabian Shield (opens in a new tab), a well-known Precambrian mining province. Surveys have identified major orebodies of gold, copper, zinc, phosphate and more. For example, the Khnaiguiyah project (Al Rayn Terrane) is projected to contain ~26 Mt of zinc-copper (valued over $80 billion in situ investornews.com (opens in a new tab)) – one of the world’s largest undeveloped base-metals deposits, cites Lexology (opens in a new tab). Saudi Arabia also claims substantial reserves of lithium (notably in oilfield brines discovered by Aramco, with production targeted by 2027) and large phosphate and bauxite assets for fertilizers and aluminum.

Crucially, updated geological models and airborne surveys (mapping ~600,000 km² in 2024) have revealed significant rare-earth potentials, as cited by Discovery/Alert. Analysts estimate that Saudi Arabia’s identified rare-earth deposits alone account for tens of billions of dollars of resource value, as cited by Reuters and InvestorNews (opens in a new tab).

Exploration Activity

The pace of exploration is accelerating. In 2025 alone, the government granted dozens of new licenses (over 4,700 km²) and attracted both domestic and foreign miners. As reported in Fast Company, the number of licensed explorers has jumped from only a handful in 2020 to well over a hundred by 2023. International survey firms (including China’s) have aided this process, as Saudi authorities have widely shared seismic and drill data. The results have been dramatic: between 2016 and 2024, Saudi Arabia’s estimated resource base shot up 90% to $2.5T per S&P Global.

Processing and Industrial Capacity

Despite its geology, Saudi Arabia currently has no commercial rare-earth or battery-metal processing plants. Most of the kingdom’s mining today is upstream: Ma’aden mines gold, phosphate, and aluminum (bauxite) and ships out concentrates. The Saudi strategy is to develop downstream capacity through refining and value-added manufacturing. This is why so many deals focus on building a processing hub inside the kingdom. As Reuters and others note, Saudi officials explicitly “aim to have those rare earths processed into a form that can be used to make electronics inside the kingdom” rather than exporting raw ore. Similar ambitions apply to lithium, nickel, and copper refining.

The government’s Global Supply Chain Resilience Initiative ( (opens in a new tab)Nov 2024) is funding domestic smelters—e.g., $9.3 bn to copper (with Vedanta) and zinc (with Zijin) smelters—to ensure raw inputs are refined locally. Separately, Saudi Aramco’s venture Lucid Energy is building a large EV battery-assembly factory in Saudi Arabia, which will eventually consume local critical minerals.

However, the current processing capacity remains very limited. For rare earths specifically, Saudi Arabia must import all technology, equipment, and expertise. The standard REE separation process is complex and environmentally challenging, as REEx often cites.  None of the shortlisted partners (MP, Shenghe, Lynas, Neo) has completed an overseas REE refinery besides Lynas’s U.S. plant under construction.  Saudi Arabia has started training a domestic workforce and exploring research avenues (e.g., clean separation methods), but in the near term, almost all know-how will come from foreign partners.

Challenges and Risks

Saudi Arabia’s rare-earth strategy is bold, but it faces substantial obstacles:

Challenges/Risks	Summary
Regulatory and Governance Hurdles	Despite recent reforms, Saudi Arabia’s mining sector remains highly state-driven. Ma’aden and Manara (PIF) dominate the field, and licensing often involves complex government approval. This can slow project approvals and deter private investors. Transparency is a concern: Saudi is not yet a member of the Extractive Industries Transparency Initiative (EITI) reports SWP Berlin, and NGOs warn that environmental and social safeguards are not fully up to international standards. The SWP think-tank notes that “direct state control does not foster transparency” and that new projects could be subject to political influence. Foreign investors must navigate evolving regulations and the influence of the Public Investment Fund, which holds golden shares in many projects.
Technical and Expertise Gaps	Saudi currently lacks domestic experience in advanced minerals processing (especially rare-earth separation and magnet-making). Building this expertise will take time. As one source put it, Saudi Arabia must contend with refining “17 metals, each nearly the same size and weight, making separation complex”. Developing in-situ leaching or recycling technologies (as discussed in U.S.-Saudi talks) may help, but trial-and-error is inevitable. Meanwhile, competition for skilled labor and technology is intense: Chinese, American and Australian firms are also racing to expand refining capacity worldwide.
Supply Chain Limitations	Globally, China controls ~90% of rare-earth processing and most magnet manufacturing. Saudi Arabia will have to import rare-earth concentrates and processing equipment in the interim, and possibly even ship intermediates to third-country refineries (as Ma’aden’s partner might). Supply of other critical materials is similar: for example, no commercial lithium-ion battery supply chain exists in Saudi Arabia yet. Any joint EV-battery or electronics plans depend on upstream reliability: shipping, logistics, or quality control disruptions could slow progress. The Saudi desert’s remoteness also means building water, power, and transport infrastructure for new mines – all significant investments.
Geopolitical and Market Risks	Globally, China controls ~90% of rare-earth processing and most magnet manufacturing. Saudi Arabia will have to import rare-earth concentrates and processing equipment in the interim, and possibly even ship intermediates to third-country refineries (as Ma’aden’s partner might). Supply of other critical materials is similar: for example, no commercial lithium-ion battery supply chain exists in Saudi yet. Any joint EV-battery or electronics plans depend on upstream reliability: disruptions in shipping, logistics, or quality control could slow progress. The Saudi desert’s remoteness also means building water, power, and transport infrastructure for new mines – all significant investments.

Despite these challenges, Saudi leaders argue the long-term rewards justify the risks. With depleting oil fields and global demand for clean-technology minerals surging, the country bets that its vast reserves can be unlocked. Already, foreign partners see an opportunity: Aramco’s deal with BYD and Ma’aden’s engagement with MP Materials and others suggest growing confidence.

The Kingdom certainly has the ambition, drive, and lots of money.  Ultimately, Saudi Arabia aims to become a miner and a critical node in global supply chains – “a geopolitically neutral link” bridging East and West. For investors, this means watching both the policy rollout (licenses, regulations) and the outcome of key partnerships (who Ma’aden picks, how US-Saudi talks go, etc.) – as these will determine whether Saudi Arabia’s rare-earth gambit reshapes the market or remains a bold vision.

Sources: Public statements by Saudi officials and energy news organizations; Reuters news reports (Mar–May 2025); Arab News, SWP Berlin; company press releases; REEx network; and original research.