In a strategic move aimed at strengthening its position in the Saudi mining sector, the major mining companies (AMAC) announced today that its board of directors has approved the establishment of a wholly owned subsidiary, in the form of a simplified joint-stock company, with a capital of 100 million Saudi riyals.
Details of the new entity and its headquarters
In an official statement published on the Saudi Stock Exchange (Tadawul) website, the company clarified that the new entity will be headquartered in Najran. Its activities will primarily focus on drilling and exploration, as well as providing related support services to the mining sector, following the completion of all regulatory procedures and the acquisition of necessary approvals and licenses from the relevant authorities in the Kingdom.
Company strategic objectives
This decision aligns with AMAC's overall strategy to develop its operational structure. Through this expansion, the company aims to achieve vertical integration in its operations, thereby enhancing operational efficiency and reducing reliance on external contractors for core drilling operations. This, in turn, will positively impact profit margins and support sustainable growth plans.
The context of the mining sector and Vision 2030
This announcement takes on particular significance when viewed within the context of the major transformations underway in the Saudi economy as part of Vision 2030. The Kingdom is giving unprecedented attention to the mining sector, working to transform it into the third pillar of national industry, alongside oil and petrochemicals. The Kingdom's mineral wealth is estimated at approximately 5 trillion riyals, making investment in drilling and exploration technologies and companies a pressing necessity for the efficient extraction of these resources.
The importance of exploration and the future of the sector
Drilling and exploration are the lifeblood of any mining company, ensuring continuous production by discovering new reserves that replenish extracted quantities and extend the lifespan of mines. By establishing a specialized arm in this field, AMAC guarantees greater speed and flexibility in implementing its exploration programs in the Arabian Shield region, which is rich in base and precious minerals.
Local economic impact in Najran
On the local level, the establishment of the new company in Najran is expected to contribute to supporting the local economy of the region, creating new job opportunities for national cadres specializing in geology and mining engineering, in addition to strengthening local supply chains, in line with the Kingdom’s directions to enhance local content in major industrial projects.
