An aerial view of the brine ponds and processing areas at Chilean SQM's lithium mine (Sociedad Quimica Minera) in the Atacama Desert, Calama, Chile, on September 12, 2022.
Martin Pernetti | AFP | Getty Images
RIYADH, Saudi Arabia – The energy minister of Saudi Arabia – a Gulf kingdom whose wealth and power depends disproportionately on its vast oil reserves – believes that oil no longer poses a challenge to energy security.
Instead, he said, the next battle will be over entirely different materials buried underground: critical minerals.
“Oil is no longer a challenge to energy security, it will be mostly gas, electricity and metals,” Saudi Energy Minister Abdulaziz bin Salman told attendees at the annual Future Minerals Forum in Riyadh.
“Today, some of these countries, as a nation, have 50% ownership of some of these in-demand minerals and critical minerals… Countries are racing to acquire critical minerals and secure their supply chain. Rushing to secure access to these resource minerals will ultimately lead to higher emissions and higher costs.” Metals and energy prices rise.
The Energy Secretary was referring to minerals important for the energy transition and advanced technologies – including lithium, cobalt, nickel, graphite, manganese and other rare earth elements essential to making things like electric cars, batteries, renewable energy technology, computers and household goods. .
China currently controls approximately 60% of the world's production of minerals and rare earth materials. According to a recent report Written by the Baker Institute for Public Policy at Rice University. This is of concern to many countries, especially those in the West, as these resources are more important than ever to national security and economic stability.
“More artificial intelligence and data centers means more energy,” bin Salman said. “You will have artificial intelligence, data centres, mining, cryptocurrency mining… Can you imagine what will happen to energy demand? Can you imagine the race between mining to produce energy, and energy to create mining and the growth of these economies?” the Energy Secretary asked.
“I really didn't like the idea of being Secretary of Energy at that time.”
Demand for electricity is rising around the world, fueled by growing demand for data centers needed to power artificial intelligence, factories, electric vehicles, and hotter and longer summers. A recent Department of Energy memo cited in numerous press reports predicted that US power grids could see up to 25 gigawatts of new data center demand by 2030.
Critical minerals and rare earth minerals are also essential for renewable technology such as solar panels and wind turbines, which are key to many countries' efforts toward an energy transition away from fossil fuels. China refines 95% of the world's manganese – A chemical element used in the manufacture of batteries and steel – although its extraction represents less than 10% of its global supply.
Saudi Arabia announced this on Wednesday Working on a mining investment worth $100 billion It aims to become a global center for mining, mineral extraction and processing. The Kingdom plans to significantly expand lithium exploration operations within its borders, as well as other important minerals.
Strengthening the minerals sector and investing in the local supply chain is part of Saudi Arabia's Vision 2030 to diversify its economy away from oil.
