In an interview with Reuters in Sydney, the minister added that his team is meeting with its Australian counterparts to learn more about the launch of a metals index similar to the Australian ASX 300 sub-index of metals and mining, which includes metals and mining companies, including gold, steel and precious metals producers.
“It’s something we’re looking at…but we haven’t made up our minds yet on whether it will work,” Alkhorayef said.
“We have a secondary stock market in Saudi Arabia… and it’s still developing. We want to see if it’s better to have something to mine,” he added.
He did not say how many companies might be included in the index.
The Saudi stock market consists of the main Tadawul market and the parallel Nomu market, which companies can join on lesser terms.
Riyadh’s efforts to build an economy that does not depend on oil include a shift towards mining to explore the country’s untapped reserves of resources such as copper, phosphate and gold.
The Minister is participating in the International Conference on Mining and Resources in Sydney this week to galvanize investment interest. He said last Wednesday that the Kingdom plans to offer more than ten licenses for mineral exploration to international investors.
Al-Khorayef explained that the launch of a separate index for mining would help increase focus on the mining industry in Saudi Arabia, and would enable them to compare it to markets such as Australia, the United Kingdom, and others.
“The idea is to help the sector grow faster. We certainly see a need for small and medium-sized companies in the sector to access capital through the capital markets,” he added.
Real estate, energy and trading companies dominate the Saudi stock markets today, while there are a few mining companies, led by the Saudi Arabian Mining Company (Maaden), the largest mining company in the Gulf.
“The whole idea (of a mining index) is to make sure we have something that can provide new insight to finance companies or financial institutions like banks,” he said.
Find Partnerships
Al-Khorayef stated that the Saudi government believes it has untapped mineral resources estimated at 1.33 trillion dollars, which include huge amounts of aluminum, phosphates, gold, copper and uranium.
He explained that he had discussions with several mining companies in Sydney this week, including mining giants around the world such as BHP Group, about collaborating in the exchange of knowledge and experience and adopting their successful business model.
“In terms of being able to fund a lot of projects, Saudi Arabia is in a very good position. But we always seek partnerships because we believe strongly that we can succeed through cooperation,” he said.
“We want to encourage individuals who provide services to mining companies to come to Saudi Arabia either directly or by partnering with some Saudis. Everyone should look at Saudi Arabia as a potential market,” he added.
The kingdom is hosting a Future Metals conference in Riyadh in January, where it hopes to announce more details about its plans for the mining sector.
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