Saudi’s Ma’aden to start up third phosphate project in 2018

Saudi Arabia’s national mining company Ma’aden aims to start operations at a third phosphate facility at Waad al-Shamal in 2018, energy minister Khalid al-Falih told Reuters on Wednesday.

Ma’aden is expanding as part of Saudi Arabia’s bid to diversify the economy beyond oil exports. The government aims to more than triple mining’s contribution to the nation’s economic output by 2030.

The company said last year it was developing its third project to manufacture phosphate fertilisers at its Waad al-Shamal facility in northern Saudi Arabia at an estimated cost of around SAR24bn ($6.4bn).

“We think Phosphate III in Waad al-Shamal in northern Saudi Arabia will be kicked off,” Falih said in an interview, when asked about plans for the mining sector next year.

“Ma’aden is ready to move forward with this. This will position Saudi Arabia to be one of largest phosphate fertiliser countries in the world,” said Falih, who is also the kingdom’s industry minister and serves as chairman of Ma’aden.

Once at full capacity, the complex will roughly double Saudi Arabia’s production of the product to 6 million tonnes a year.

The government approved a mining strategy two weeks ago that focuses on building a digital database of mineral deposits, accelerating licensing processes and providing funding to mining companies, particularly smaller players, the minister said.

“We see 2018 as building a platform for many projects to come in subsequent years,” Falih said.

Falih said he also expected progress next year on a $3.5bn expansion of the company’s aluminium facility at Ras al-Khair, for which Ma’aden asked banks to refinance some $2.88 billion of debt in September.

Read: Saudi king opens $35bn mining hub in push to move beyond oil

“These brownfield projects tend to be more profitable than original greenfield projects. So these are moving forward,” he said, adding that Ma’aden would announce other projects in gold and copper in future, without giving a precise time frame.