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Aerial view of the brine ponds and processing areas of the Chilean company SQM (Sociedad Quimica Minera) lithium mine in the Atacama Desert, Calama, Chile, on September 12, 2022.
Martin Bernetti | Afp | Getty Images
RIYADH, Saudi Arabia – The energy minister of Saudi Arabia – the Gulf kingdom whose wealth and power rest disproportionately on its vast oil reserves – believes that oil is no longer an energy security issue.
Instead, he said, the coming battle will be over very different materials buried underground: important minerals.
“Oil is no longer an energy security issue – it will be gas, electricity and mostly minerals,” Saudi Energy Minister Abdulaziz bin Salman told participants at the annual Future Minerals Forum in Riyadh.
“Today, some of these countries as a country have 50% ownership of some of these essential minerals and critical minerals … countries are racing to access critical minerals and secure their own supply chain. The rush to secure access to resources will ultimately lead to higher emissions, higher metal prices, and higher energy prices.”
The energy secretary was referring to minerals that are critical to the energy transition and advanced technologies – including lithium, cobalt, nickel, graphite, manganese and other rare earth elements that are critical to making things like electric cars, batteries, technology renewable energy, computers and household goods. .
China currently controls approximately 60% of the world’s production of rare earth minerals and materials, according to a recent report Baker Institute of Public Policy, Rice University. This is of concern to many countries, especially in the West, as these resources are increasingly important to national security and economic stability.
“More AI (artificial intelligence) and data centers means more energy,” Bin Salman said. “You will have artificial intelligence, data centers, mining, cryptomining … can you imagine what will happen to the demand for energy? Can you imagine a race between mining to produce energy and energy to create mining and the growth of these economies? ” – asked the Minister of Energy.
“I really don’t like the idea of being the energy secretary at that time.”
Global demand for electricity is rising, fueling demand for the data centers needed to power AI, factories, electric cars, and hotter, longer summers. A recent memo from the Department of Energy, cited in numerous press reports, predicts that by 2030 US power grids may need up to 25 gigawatts of new data centers.
Essential minerals and rare earth metals are also important for renewable technologies such as solar panels and wind turbines, which are central to many countries’ efforts to transition energy away from fossil fuels. China refines 95% of the world’s manganese — a chemical element used in storage batteries and steel production — despite the fact that less than 10% of its global supply is mined.
Saudi Arabia announced this on Wednesday is working on a $100 billion mining investment as it aims to become a global hub for mining and processing minerals. The Kingdom plans to significantly expand exploration for lithium within its borders, as well as other important minerals.
Development of the mineral sector and investment in the domestic supply chain are part of Saudi Arabia’s Vision 2030 mission to diversify the economy away from oil.
