Saudi Arabia’s Ministry of Industry and Mineral Resources has launched the prequalification round for Umm Ad Damar Exploration License.
The Umm al-Damar site covers an area of more than 40 square kilometres (sq km) and includes copper, zinc, gold and silver deposits, the ministry said in a press statement in on Wednesday.
It said the tender process for the site, which is located 300 km northeast of Jeddah and 25 km northwest of Mahd Al Thahab Governorate, would take place in three stages: Registration, Qualification, and Bidding and grant.
The granting of the license is scheduled to be announced by the third quarter of 2022, the statement said.
The statement also added that the license winner for Khnaiguiyah site, the first to be offered under Saudi Arabia’s new mining law, would be announced in the third quarter of 2022.
The Khnaigiuyah site is the largest exploration site in the Kingdom covering an area of more than 350 sq km with copper and zinc deposits.
It said qualified bidders for Khnaiguiyah would be automatically qualified for Umm Ad Damar without the need to submit an additional PQQ document, upon informing the Ministry of their registration.
The list of qualified firms for Khnaiguiyah, issued in April, comprised of Alara Saudi Ventures; Al Masane Al Kobra Mining Company (AMAK); Essel Mining & Industries; Ivanhoe Electric; Moxico Resources; Norin Mining; Saudi Arabian Mining Company (Ma’aden); and Vedanta.
Umm Ad Damar has an expected investment size of 2 billion Saudi riyals ($533 million) and is expected to generate around 4,000 jobs, according to the project brochure available on the Ministry's mining portal.
Previous geological studies have indicated the presence of four prospects at the Umm al-Damar site - Umm Ad Damar North, Umm Ad Damar South, 4/6 Gossan and Jabal Sujarah, the brochure said.
Saudi Arabia's investment incentives for mining projects include co-funding from the Saudi Industrial Development Fund for up to 75 percent of any new investment; five-year royalty holiday and royalty discounts for downstream projects.
(Writing by Anoop Menon; Editing by Seban Scaria)