Guys, I apologise for lying to you. I told you before Saudi will make minerals an important source of revenue for the country. Iran made sure to prove me wrong.
The fund Riyadh built to acquire global mining stakes is quietly retiring the strategy.
Manara Minerals, the PIF-Ma'aden joint venture launched in 2023, is pivoting away from foreign equity acquisitions. The new mandate is trading partnerships and debt investments with offtake rights. Ownership is out.
Manara's purpose was explicit. Acquire minority stakes in iron ore, copper, nickel, and lithium mines abroad. Route the raw materials into a Saudi processing hub. Bolt the kingdom into the global critical minerals architecture before the energy transition locked in its supply chains.
One deal was ever executed. A $2.5bn purchase of 10% of Vale Base Metals in April 2024, at an implied enterprise value of $26bn. Since then, nothing. Two years of scanning the market, two years of walking away. The stated reason is valuations. The real reason is capital.
This is not a strategic refinement. It is a retreat under fiscal pressure at the worst possible moment. Critical mineral prices are at or near record highs. Washington and Beijing are competing openly for offtake. A sovereign vehicle designed to buy mining equity is withdrawing exactly when it should be deploying.
The pivot reads as a euphemism. Capital efficiency. Debt over equity. Joint ventures with Glencore, Trafigura, and Mercuria rather than control stakes. Offtake-secured loans rather than ownership. Translated, Riyadh can no longer pay peak-cycle prices for minority positions in mines it will never operate.
The broader PIF posture tells the same story. Majority sale of its flagship football club this month. LIV Golf funding under review after $5bn in losses since 2022. The 2026 to 2030 strategy explicitly rebuilt around returns, portfolio discipline, and attracting foreign capital rather than deploying Saudi capital. The era of signalling-through-expenditure is winding down.
The Hormuz closure since late February has sharpened the triage. Saudi crude exports are running at around 5 million barrels a day through the Red Sea pipeline, roughly 70% of prewar volumes. Every remaining riyal of PIF capacity is being weighed against wartime logistics, AI infrastructure, Expo 2030, and the 2034 World Cup.
The war itself has rewritten the risk calculus. Iran has demonstrated it can shut Hormuz, reach Gulf infrastructure, and pull Saudi assets into an active regional exchange of fire. Illiquid foreign equity looks reckless in that environment. A ten-year mining capex commitment in Brazil, Canada, or Indonesia cannot be repositioned when a drone lands on Abqaiq or a missile volley reopens over Riyadh. Sovereign capital under active threat has to be liquid and redeployable. Locking billions into minority stakes in jurisdictions Riyadh does not control is the opposite posture. Debt with offtake rights can be restructured, rolled, or written off. Equity cannot.
Mining was supposed to be Vision 2030's third pillar, targeting a quadrupling of GDP contribution to roughly $75bn by 2030 on a $2.5tn domestic reserve estimate. The domestic leg continues. Exploration budgets are up from $21m in 2022 to $146m in 2025. The foreign equity leg, which Manara was built to deliver, is being dismantled.
Loans-for-offtake is the Chinese template for African mining. It works for Beijing because it couples with massive industrial absorption at home and state-to-state political cover. Saudi Arabia is adopting the form without either. The result is a minority stake in other people's supply chains rather than a processing hub.