Wa’ad El-Shamal: The capital of global phosphate

Wa’ad El-Shamal: The capital 
of global phosphate

In January 2014, a number of government ministers gathered in a desert tent near Tarif Governorate, one of Saudi Arabia’s northern border governorates. The purpose of this meeting was to sign contracts in order to build an industrial complex around a phosphate mine, and a new rail link to a port on the Arabian Gulf, with total investment of more than SR36 billion. This followed the discovery that the northern border area contains seven percent of the world’s phosphate reserves, especially in the regions of Al-Jalamid and Um W’al between Ar’ar and Tarif. The project has given rise to an integrated mining city known as Wa’ad El-Shamal for Mining.

In 2017, the first shipment of phosphate fertilizers, estimated at 26,000 tons, was exported via the North Railway to Ras Al-Khair port on the east coast of the Kingdom from where it was shipped. On November 29, Custodian of the Two Holy Mosques King Salman inaugurated the first stage, as well as laying the foundation stone for the second stage, with investments estimated at SR85 billion. This, in turn, makes the city part and parcel of the global map of phosphate industries, and one of the world’s largest phosphate producing and processing capitals. With its completion and capacity, the Kingdom will become the world’s second largest producer of phosphate fertilizers.

This huge industrial project will undoubtedly have a great economic, social and international impact on the Kingdom. At the economic level, since 2017 the factory has exported more than 1.7 million tons of phosphate. At the end of the first phase, the capacity of the factory will rise from 3 million tons to 6 million tons. With the completion of the second phase, Saudi Arabia’s phosphate production will reach 9 million tons per year. This means the Kingdom’s non-oil Gross Domestic Product GDP will be boosted by SR24 billion ($6.4 billion) a year, or about 3 percent.

On the social and developmental level, the project of Wa’ad El-Shamal, as well as the two largest solar projects of Sakaka, which is the largest worldwide, and the wind power project in Doma Al-Jandal, all projects in the northern region, will undoubtedly contribute to the economic and social development of the region to say nothing of achieving developmental balance in all regions of the Kingdom.

Wa’ad El-Shamal was preceded by major Saudi industrial projects, such as the construction of Ras Al-Khair and the industrial cities of Jubail and Yanbu, which have contributed to the development of these areas and have become a magnet for investment and for those seeking jobs in the region. According to official statements, the Wa’ad El-Shamal project, when completed, will offer significant investment opportunities and will create more than 30,000 jobs directly and indirectly.

This mammoth project will put Saudi Arabia on the map of countries contributing to world food security, pursued by the United Nations, and to the elimination of hunger worldwide. This will be achieved via the production of 9 million tons of phosphate fertilizers that will raise soil fertility and productivity. This will lead to the reclamation of more agricultural land, increase farmers’ income, provide more jobs, push the economic wheel in a number of countries in the world, and help governments to provide food for their people. This increase in production is a result of the addition of fertilizers to the world’s crop production.

Finally, the mining sector is a key element in the national transformation and the Kingdom is working hard to make it the third pillar of the Saudi economy, alongside the oil and petrochemical industries. According to some geological surveys, there are more than 800 gold and silver ore sites, 850 copper ore sites, 64 lead ore sites and 180 locations for the mining of platinum, nickel, chromium and uranium ore, as well as a vast wealth of rocks and industrial minerals. The Ministry of Energy estimates that the value of untapped mineral resources in the Kingdom is SR 5 trillion ($1.33 trillion).

Dr. Ibrahim Al-Othaimin is a Middle East affairs specialist and security analyst based in Riyadh. He can be contacted at Ibrahim.othaimin@gmail.com. Follow him on Twitter @Alothaimin