Saudi Aramco, the world’s largest oil company is to up investments in lithium production to strengthen metal supply chains for electric vehicle (EV) batteries.
The Saudi state giant is expected to announce that it will fund lithium production in attempts to diversify from oil.
China currently commands around two-thirds of the lithium processing market, but Middle Eastern companies are attempting to build their own supply chains, according to the FT.
Industry and mineral resources minister Bandar Alkhorayef told the FT “Saudi Arabia is very well positioned in processing because of the mixture that we have, starting from energy competitiveness, great infrastructure in terms of industrial cities and ports.”
These anticipated investments could break into the market and compete with China’s lithium dominance, leaving high potential for yield from Western companies using the metal to build EV batteries.
Global lithium demand is projected to grow seven-times by 2040, due to the riding demand for EVs, according to the International Energy Agency.
Saudi Arabia is constructing an EV manufacturing hub in King Abdullah Economic City which is where PIF-backed brand Lucid Motors began assembling cars in 2023.
Daisy Jennings-Gray, head of prices at Benchmark Mineral Intelligence, said “We’ve not really seen Saudi Arabia play much of a part in the battery raw materials or lithium space generally so far.”
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