In a move to potentially reshape the global copper market, Chile's Codelco, the world's largest copper producer, is in talks with Saudi Arabia about joint investments in copper. This news comes as Saudi Arabia attempts to diversify its economy away from oil and establish itself as a hub for electric vehicle and battery manufacturing.

Codelco's chairman, Maximo Pacheco, expects the company's copper production to reach around 1.4 million tons in 2025, a 70,000-ton increase from 2024. He expressed a willingness to explore joint investment opportunities with Saudi Arabia, citing a mutual interest in adding value to the copper industry.

Saudi Arabia's interest in copper stems from its ambitious plans to become a leader in electric vehicle and battery production. Copper is a vital material in these technologies, and by securing a steady supply, Saudi Arabia hopes to gain a competitive edge.

Discussions between Codelco and Saudi Arabia have included potential technology transfers. Saudi Arabia is particularly interested in Codelco's expertise in desalination, a process crucial for operating mines in arid regions. The talks have also touched upon incorporating artificial intelligence into mining operations to improve efficiency and productivity.

While copper is the primary focus of this potential partnership, discussions have also included lithium. Chile is the world's second-largest lithium producer, and Saudi Arabia is keen to import the battery metal to meet its domestic processing needs.9

Though Codelco is not considering Saudi companies for a major lithium project slated for a March board vote, the possibility of future collaboration in lithium cannot be ruled out.

This potential partnership between Codelco and Saudi Arabia has the potential to significantly impact the global copper market. If successful, it could lead to increased copper production, technological advancements in mining, and a more prominent role for Saudi Arabia in the battery metals industry.

Codelco (Corporación Nacional del Cobre de Chile) is the world's largest producer of copper, based in Chile. Founded in 1976, the state-owned company plays a critical role in the global copper industry, with vast mining operations across Chile, including at key sites such as El Teniente, Chuquicamata, and Andina. Codelco is essential to Chile’s economy, contributing significantly to national revenue through copper exports. The company focuses on sustainable mining practices, technological innovation, and maintaining its leadership in copper production, crucial for industries ranging from electronics to renewable energy and electric vehicles. Codelco continues to adapt to global market demands and challenges.