Saudi Arabia’s Public Investment Fund is considering spinning off its mining arm, Manara Minerals, in a bid to improve its international investment strategy.
Manara, established in 2023 as a joint venture between the Saudi Arabian Mining Company (Maaden) and PIF, was created to invest in essential minerals globally.
In its ventures to secure critical resources like copper and lithium, crucial for electric vehicles and renewable energy, the entity has thus far been involved in a single significant transaction: a $2.5B acquisition of a 10% stake in Vale Base Metals, a segment spun off from Brazil’s Vale.
Bandar Al-Khorayef, the Minister of Industry and Mineral Resources, stated that extracting Manara from under PIF’s vast investment umbrella could hone the firm’s technical prowess. “This adjustment will shift its orientation from merely functioning as an investment vehicle to developing specialised expertise,” Al-Khorayef remarked. He highlighted that while PIF boasts extensive investment clout, it does not possess deep mining know-how.
Ongoing discussions with potential shareholders, both Saudi and foreign, may inform the timing and specifics of this spin-off. This move is in line with Saudi Arabia’s broader ambition to diversify its economy beyond oil, steering towards mining and international ventures under Crown Prince His Highness Mohammed bin Salman’s leadership.
Riyadh estimates the kingdom’s untapped mineral reserves, comprising phosphate, gold, bauxite and rare earth elements, could be worth an impressive $2.5T. Maaden is concurrently investigating rare earths and advancing technologies to extract lithium from seawater.
The strategy underscores Saudi Arabia’s commitment to securing resources vital for energy transition technologies and reducing its economic dependency on oil: a critical endeavour as global energy dynamics evolve.
Such a shift would potentially realign Manara to better capture complex opportunities in the international mining landscape, enhancing its role from a strategic to a more operationally proficient player in the sector.
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