Aramco, a globally renowned integrated energy and chemicals company, has joined forces with Ma’aden, the largest multi-commodity mining and metals enterprise in the Middle East and North Africa region, to announce the signing of non-binding Heads of Terms. This agreement outlines plans for the formation of a minerals exploration and mining joint venture (JV) within the Kingdom of Saudi Arabia. The strategic collaboration aims to accelerate the exploration and extraction of energy transition minerals, with a particular focus on lithium from high-concentration deposits. The JV also seeks to develop cost-effective direct lithium extraction (DLE) technologies, with the potential to commence commercial lithium production by 2027.
Advancing Saudi Arabia’s Role in the Energy Transition
The proposed joint venture would mark a significant extension of Aramco’s operational scope, leveraging its vast expertise in technological innovation, resource optimization, and data management. The initiative aligns with Saudi Arabia’s vision of unlocking its high-value mineral resources to meet the surging global and domestic demand for lithium and other crucial transition minerals. By integrating Aramco’s subsurface data capabilities with Ma’aden’s mining expertise, the JV aspires to create an advanced resource extraction framework that aligns with the Kingdom’s economic diversification and energy transition goals.
Saudi Arabia is endowed with substantial reserves of transition minerals, offering remarkable potential for extraction. As part of its extensive operations, Aramco has identified multiple regions with exceptionally high lithium concentrations, reaching up to 400 parts per million. By harnessing its existing infrastructure, pioneering drilling operations, and over 90 years of geological data, Aramco is poised to make significant advancements in sustainable mineral extraction.
Leveraging Expertise for a Sustainable Future
Nasir K. Al-Naimi, Aramco Upstream President, emphasized the strategic importance of the initiative, stating:
“This announcement reflects Aramco’s commitment to positively contributing to the global energy transition. Through this proposed JV, we aim to extract energy transition minerals efficiently, supporting the growth of more sustainable energy solutions while diversifying our portfolio for a lower-carbon future. By leveraging our world-leading upstream enterprise, we expect to apply substantial low-cost advantages, cutting-edge industry expertise, and technological innovation to meet the Kingdom’s and the world’s growing lithium demand.”
Darryl Clark, Ma’aden’s Senior Vice President of Exploration, underscored the vast opportunities presented by the partnership, remarking: “Ma’aden has been undertaking one of the world’s largest single-jurisdiction exploration programs across the Arabian Shield to unearth the estimated $2.5 trillion mineral endowment. This proposed JV provides us with the opportunity to accelerate exploration efforts within the Arabian Platform, integrating Aramco’s unparalleled knowledge of the region with Ma’aden’s extensive expertise in mining and resource development.”
Meeting the Soaring Global Demand for Lithium
As a critical element in the energy transition, lithium plays a vital role in the production of advanced technologies, including electric vehicle batteries, energy storage systems, and renewable energy solutions. Over the past five years, global lithium demand has tripled, with projections indicating a compound annual growth rate exceeding 15% per annum through 2035. The demand surge is driven by the global shift toward electrification and sustainability, making lithium one of the most sought-after minerals of the 21st century.
The envisioned joint venture could play a pivotal role in fulfilling Saudi Arabia’s increasing lithium needs, with domestic demand anticipated to grow twenty-fold between 2024 and 2030. This demand surge aligns with the Kingdom’s ambition to support the production of an estimated 500,000 electric vehicle batteries and facilitate the generation of 110 GW of renewable energy. By positioning itself as a key player in the lithium supply chain, the JV could help transform Saudi Arabia into a major contributor to the global energy transition.
Unlocking Strategic Economic and Environmental Benefits
Beyond commercial objectives, the JV is expected to contribute significantly to Saudi Arabia’s long-term sustainability goals. By utilizing cutting-edge lithium extraction technologies, the initiative seeks to minimize environmental impact while maximizing resource efficiency. Innovations such as Direct Lithium Extraction (DLE) offer a more sustainable alternative to traditional lithium mining methods, reducing water and energy consumption while enhancing recovery rates.
The partnership also has the potential to foster job creation and skill development within Saudi Arabia’s mining and energy sectors. By leveraging Aramco’s and Ma’aden’s collective expertise, the JV aims to establish best-in-class operational standards, fostering a new era of resource sustainability and economic resilience.
