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Saudi Arabia Expands its Lithium Production

Saudi Arabia Expands its Lithium Production
Image Source: Pixabay

The world’s largest oil company, Saudi Aramco, is planning to expand its investments in lithium production. Aramco is expected to announce a boost to its investments in lithium development on January the 16th.

The move comes amid a global race to develop supply chains for lithium, a key component to produce electric car batteries.

A Fierce Competition with China 

Two-thirds of the lithium processing market is now controlled by China. However, a growing number of Middle Eastern and Western companies are developing their own supply chains. 

In statements reported by Al Arabiya citing the Financial Times, Minister of Industry and Mineral Resources, Bandar Alkhorayef, stated that the Kingdom is seeking to establish lithium processing facilities within 3 to 5 years.

Al-Kharif added that KSA has great potential in the field of lithium processing due to energy competitiveness and strong infrastructure.

The need for lithium is expected to grow by 2040 due to demand for electric vehicles. Now, Saudi Arabia is building an electric vehicle manufacturing hub in King Abdullah Economic City on the Red Sea coast. 

Promising Investment plans 

The kingdom is also planning to decrease their reliance on oil revenues and expand its metals and minerals sector. This comes as part of its plan to boost the economy while decreasing their reliance on oil revenues. 

In collaboration with lithium startup Lihytech and state-owned mining company Maaden, Aramco announced the first successful extraction of the mineral from salt water in oil fields.

In Saudi Arabia, there are two lithium processing facilities in the planning stages. “European Lithium” company announced in 2023 that it would build a lithium hydroxide production facility in Saudi Arabia.

Energy companies ready to develop lithium production, as many of the skills used in oil production, such as pumping and underground reinjection, are essential to produce lithium.

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