Umm Wual phosphate project viable: Maaden
Al Khobar, February 13, 2012
Saudi Arabian Mining (Maaden) said on Monday it had completed a preliminary feasibility study and plans a project to exploit phosphate deposits at Umm Wual in the north of the country.
The state-controlled minerals firm is awaiting licenses to move ahead with the project, it said in a Saudi bourse statement.
Investment is estimated to be $5 billion, said an industry source who declined to be identified.
Maaden would mine the Al Khabra deposit in Umm Wual, 40 kilometres northeast of Turaif.
State oil giant Saudi Aramco is considering developing new gas fields, Midyan and Sidr, in the Northwest area to produce gas for power plants and potentially supply other industries in a region rich in iron ore deposits.
Saudi Arabia possesses the world's largest oil reserves but is keen to develop its mining industry to diversify the economy away from oil.
The Umm Wual project would add nearly 1.5 million tonnes annually of phosphorus oxide to Maaden's planned phosphate capacity, Maaden said on its website in a brief description about the project.
The Al Khabra mining deposit has very low metal content with resources at 236 million metric tonnes of phosphorous oxide while the Umm Wual area contains indicated resources of 450 million metric tonnes, Maaden said on its website.
An industry source said the project would use infrastructure already put in place in Ras Al-Khair, formerly known as Ras Azzour, where Maaden has a phosphate project with Saudi Basic Industries Corp (Sabic).
The Sabic-Maaden's venture has a production capacity of about three million tonnes per year (tpy) of diammonium phosphate fertilizer (DAP). – Reuters