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Saudi Arabia is getting serious about copper production. And they’re partnering with an Indian mining giant to starting scaling up.
What’s happening:
- Indian mining conglomerate Vedanta Limited has announced their subsidiary Vedanta Copper will put $2B USD into funding the construction of new copper processing facilities located in Saudi Arabia
Why it matters:
- Copper has been experiencing a growing boom in demand largely driven by the energy transition as well as the rapid build out of new data centres, which has begun to put on a crunch on the existing supply globally and caused a spike in prices
- Saudi Arabia currently imports the vast majority of their copper, which is something the government is aggressively aiming to change through deepening their commitments to critical metals and mining
By the numbers:
- The new copper smelter and refineries to be built in Saudi Arabia will have an annual capacity of 400,000 tonnes of copper
- Saudi Arabia will also construct a facility capable of producing 300,000 tonnes of copper rods annually, which are an essential input for electric cable manufacturing
Going deeper:
- Vedanta Limited is aiming to turn the new investment partnership with Saudi Arabia into the beginning of their expansion into the Middle East, which is a critical component of expanding their mining operations more globally and diversifying away from their large existing presence in both India and Africa
- The rise in copper prices has already spurred a large opportunity for publicly traded companies, with Lundin Mining (TSX: LUN) recently hitting near all time record quarterly revenue and Ivanhoe Mines (TSX: IVN) scaling up their copper production to new highs
