Mining Investment Law approved by Resolution No.634 of 2020 issued by Royal Decree No. M/140 of 2020.

This Law consisting of 63 articles divided in VIII Sections and I Annex aims at (i) repealing the previous Mining Law introducing certain changes and incentives; (ii) attracting foreign investors to the sector in order to implement Saudi Vision 2030's goals for the Saudi mining industry; and (iii) diversifying the national economy away from hydrocarbons. Key amendments to the 2004 Mining Investment Law are the following (i) establishment of a new fund (art.54) to provide sustainable finance for the development of the mining sector as well as to support geological survey and exploration programs; (ii) an increase in the types of land on which mining activities may be undertaken establishing the prohibition of mining licenses for (a) lands occupied by Holy Places or military establishments; (b) lands specified by a Council of Ministers resolution; and (c) lands reserved for hydrocarbon3 operations or as hydrocarbon exploration area (art.7); (iii) the creation of a mineral zones register; (iv) the competent representative of the MOIMR has been given the capacity of judicial officers, and is authorised to enter the licenced site to inspect, monitor, control violations and ensure the licencee’s compliance with the Law; and (v) a more comprehensive violations and penalties regime, together with the decision that one or more committees will be established by a decision of the Minister of the MOIMR who will be tasked with determining violations and imposing the applicable penalties.
The following new rules are provided for the licenses (i) under a reconnaissance license, access to private lands must be negotiated with the landowner (art.39.6); (ii) exploration license are divided in Class A (metallic minerals, precious and semiprecious stones, and ores that require advanced operations), B (metallic minerals, industrial minerals, and raw materials), and C (materials used for construction purposes). The latter has the term limited to one year, not possible to be renewed or extended, and the size of its licensed area is limited to not more than 5 km (art.40); (iii) mining licenses are limited to Class A and Class B minerals only. If the licensee wishes to exploit Class C minerals within the licensed area, it is necessary to apply to the Ministry and pay the prescribed additional financial fee (art.42).
As for the mortgages, art.22 provides that, subject to Islamic law and other applicable laws, a licensee may mortgage the rights granted by an exploration license or an exploitation license, but not those granted by a reconnaissance license. The mortgage will be effective only after the licensee has registered the mortgage in the Ministry’s license register.
Under art.4, the Ministry has to maintain three kinds of registers (1) an applications register, wherein all license applications submitted to the Ministry shall be recorded; (2) a license register, wherein all issued licenses shall be recorded, as well as any renewal, amendment, transfer, extension, mortgage, termination, expiry, etc.; and (3) a mineral zones register, wherein the details of the mineral zones shall be recorded, including: mineral formations and mineral reserve areas.
The Law repeatedly reiterates the need to protect the environment from damage and, in particular, article 35 declares that every applicant for a mining license, a small mine license, or a general purpose license must include in his application an environmental and social impact study and a site rehabilitation and closure plan, and he is committed to taking all necessary measures and precautions to preserve the water resources, the environment and wildlife and protect them from any hazardous waste or any environmental damage else.
The VIII Sections are entitled as follows (I) Definitions and preliminary provisions; (II) Lands and areas covered by and excluded from the mining activity; (III) General provisions for licenses; (IV) Rights and obligations; (V) License rights; (VI) Financial provisions; (VII) Violations and penalties; and (VIII) General Provisions. The Annex contains the Schedule of fees based on Article 49 of the Law.