Saudi Arabia forum looks to boost Middle East, Africa exploration

Saudi Arabia is attracting global mining companies to its third annual Future Minerals Forum in Riyadh on Wednesday as it invests its vast oil wealth into mining exploration with some success recently in gold.

Barrick Gold (TSX: ABX; NYSE: GOLD) CEO Mark Bristow, Robert Friedland of Ivanhoe Mines (TSX: IVN) and Ivanhoe Electric (TSX: IE; NYSE-AM: IE), Vale (NYSE: VALE) CEO Eduardo Bartolomeo, Lundin Mining (TSX: LUN) chairman Adam Lundin and Anglo American (LSE: AAL) chairman Stuart Chambers are some of the guests due to speak at the event.

Ahead of the conference, Saudi state mining company Ma’aden said in late December it found gold at multiple sites along a potential 100-km strike zone south of the country’s Mansourah Massarah gold mine, signalling potential for a new gold belt. 

Last year, Ma’aden signed working relationships with Ivanhoe Electric (TSX: IE; NYSE-AM: IE), Barrick, Eurasian Resources Group, Nokia, Shell, Bechtel and Jersey-based junior Royal Road (TSXV: RYR) to explore Saudi Arabia as well as Morocco. The conference hosts want to expand mining investment across what it calls a super region comprising the Middle East, Africa and into Asia. More agreements could come out of this year’s event.

“It’s interesting to follow the involvement of the Saudis and the growth in terms of where they are getting involved within this greater region,” Ivanhoe Mines CEO Marna Cloete told the The Northern Miner in an interview on Tuesday near the conference. “I would like to see government-to-government cooperation in terms of infrastructure development.”

Infrastructure needed

Such investment might be traded for deals in mineral supplies or refinery agreements, said the executive with Ivanhoe, which has the Kamoa-Kakula mine in the Democratic Republic of Congo that produced 393,551 tonnes of copper last year. Infrastructure investment is important for the region to reduce risk, Cloete said.

Ivanhoe itself is arranging US$450 million in loans for the Congo to expand its electrical grid after power outages last year limited Kamoa-Kakula’s output to the low end of guidance.

Ma’aden is keen to explore the region’s Arabian-Nubian shield of Precambrian rock with what it calls “one of the largest exploration programs in the world” without stating dollar figures. The shield straddling the Red Sea includes parts of Israel, Palestine, Jordan, Saudi Arabia and Yemen on the east, and Egypt, Sudan, Eritrea, Ethiopia and Somalia on the west.

While Saudi Arabia is inviting exploration investment, processing of claims can be difficult because of lack of capacity, some conference attendees, who declined to be named criticizing their hosts, told The Northern Miner separately on Tuesday. They said they expected a batch of claims that hadn’t been worked to be released soon to public bidding.

Ma’aden last month reported core intercepts showing 61 metres grading at 10.4 grams gold per tonne and 20 metres at 20.6 grams within 400 metres of the existing resource base at the the 7-million-oz. Mansourah Massarah deposit.

“These discoveries have the potential to be the centre of the world’s next gold rush and are a strong part of our growth strategy,” Ma’aden CEO Robert Wilt said in a release. “The Arabian Shield has enormous potential for more world class discoveries, and this is the first of many we expect to make in the coming years.”