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Aerial view of brine ponds and processing areas of the lithium mine of the Chilean company SQM (Sociedad Química Minera) in the Atacama Desert, Calama, Chile, on September 12, 2022.
Martin Bernetti | afp | fake images
RIYADH, Saudi Arabia – The energy minister of Saudi Arabia – the Gulf kingdom whose wealth and power depends disproportionately on its vast oil reserves – believes oil is no longer a challenge to energy security.
Instead, he said, the next battle will be over completely different materials buried underground: critical minerals.
“Oil is no longer a challenge to energy security: it will be gas, electricity and predominantly minerals,” Saudi Energy Minister Abdulaziz bin Salman told attendees at the annual Future Minerals Forum in Riyadh.
“Today, some of these countries have, as a country, 50% ownership of some of these necessary minerals and critical minerals…countries are competing to access critical minerals and secure their own supply chain. Running to secure access to resources will ultimately lead to higher emissions, higher metal costs and higher energy prices.”
The Energy Minister was referring to minerals critical to the energy transition and advanced technologies, including lithium, cobalt, nickel, graphite, manganese and other rare earth elements crucial for making electric vehicles, batteries, renewable energy technology, computers and items for the home. .
Currently, China controls approximately 60% of the world’s production of rare earth minerals and materials. according to a recent report by the Baker Institute for Public Policy at Rice University. This worries many countries, especially Western ones, as these resources become increasingly important for national security and economic stability.
“More AI (artificial intelligence) and data centers mean more energy,” Bin Salman said. “You will have artificial intelligence, data centers, mining, crypto mining… can you imagine what will happen to the demand for energy? Can you imagine the race between mining to create energy and energy to create mining and the growth of these economies ” asked the energy minister.
“I really don’t like the idea of being energy minister at that time.”
Demand for electricity around the world is increasing, driven by growing demand for data centers needed to power artificial intelligence, factories, electric vehicles and longer, hotter summers. A recent Department of Energy memo cited in numerous press reports projected that U.S. power grids could receive up to 25 gigawatts of new data center demand by 2030.
Critical minerals and rare earth metals are also essential for renewable technology such as solar panels and wind turbines, which are critical to many countries’ efforts towards an energy transition away from fossil fuels. China refines 95% of the world’s manganese – a chemical element used in batteries and steel manufacturing – despite extracting less than 10% of its global supply.
Saudi Arabia announced on Wednesday that it is working on a 100 billion dollar mining investment as it aspires to become a global center for both mining and mineral extraction and processing. The kingdom plans to significantly expand its exploration of lithium within its own borders, as well as other critical minerals.
Boosting its minerals sector and investing in a domestic supply chain is part of Saudi Arabia’s Vision 2030 mission to diversify its economy away from oil.
