UK and Saudi Arabia strike deal on critical minerals

Market is estimated to be worth £1 trillion

Britain's Business Secretary Grant Shapps with Saudi Arabia's Minister of Industry Bandar Alkhorayef. Picture: 10 Downing Street
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Britain and Saudi Arabia have agreed to strengthen collaboration on critical minerals such as graphite and lithium in a move that the UK hopes will bolster supply chains to green industries.

UK Business Secretary Grant Shapps announced the agreement on Wednesday during a trip to Saudi Arabia.

During his first trip to the Middle East since he was appointed to the post by Rishi Sunak last October. he will also visit the UAE later this week to show support for Cop28.

Mr Shapps said increased collaboration would enable the UK to reap even more benefits from Saudi Arabia’s critical minerals market, valued at $1.3 trillion (£1 trillion).

The Conservative government is determined to alter the structure of the UK’s critical mineral supply chains which are dominated by supplies from China.

Minerals such as cobalt, graphite and lithium are vital to the economy and used in products ranging from laptops to aircraft to electric vehicles. But domestic industries and jobs are vulnerable to the volatile nature of global markets and geopolitical crisis, as Russia's war in Ukraine has proved.

During Mr Shapps's meeting with Saudi Arabia’s Minister of Industry and Mineral Resources, Bandar Alkhorayef, the pair agreed to closer collaboration following a bilateral summit in Riyadh.

Mr Shapps said working in a closer manner with Saudi Arabia would have positive effects on the UK for decades in the future.

“Critical minerals underpin the things that make everyday life and work possible, from our cars to our phones,” he said. “It is essential that we do all we can to ensure resilient supplies of these important resources.

Grant Shapps and Bandar Alkhoraye at the Future Minerals Forum in Riyadh. Picture: 10 Downing Street

“The impact of Putin’s illegal war in Ukraine on energy prices has shown us all how important international supply chains are to our economy, and why we can never be too reliant on any one nation.

“That’s why it’s so key that we work with partners like Saudi Arabia to make sure our supply chains are diverse and robust, supporting jobs and prosperity across the UK in the decades to come.”

The partnership will open the door for the UK and the Middle Eastern nation to work together on diversifying sources of critical minerals, both through Saudi investment in Britain’s manufacturing and mining finance sectors.

It will also present new opportunities for UK mining firms to do business in Saudi Arabia, the UK’s Department for Business, Energy and Industrial Strategy said.

The department said both sides would collaborate on specific actions that can be taken “to bring our respective strengths together”.

“We will be formalising this relationship in the coming months,” the department said.

Mr Shapps sealed the deal in Riyadh, where he attended the Future Minerals Forum.

Updated: January 12, 2023, 10:37 AM
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