Saudi Arabian Mining Co. (Ma’aden) has signed a conditional common shares subscription agreement to gain 9.9% of Ivanhoe Electric Inc.’s (IE) common stock and to form a 50:50 exploration joint venture in Saudi Arabia.
The deal will provide Ma’aden, through the joint venture, with access to IE’s breakthrough Typhoon™ geophysical survey technology, which will speed up the exploration of Saudi Arabia’s lands, estimated to hold $1.3tn of untapped minerals, Ma’aden wrote in a statement.
Ma’aden’s unprecedented exploration program is driven by the Kingdom’s ambitious Vision 2030, which positions mining as a third pillar of the Saudi economy, it added.
Under its new corporate strategy, Ma’aden aims to grow 10 fold by 2040 and to move into strategic minerals to fuel the growth of downstream industries in the Kingdom, the statement noted.
The joint venture (JV) with Ivanhoe Electric will explore at least 48,500 square kilometres of land, an area larger than Denmark, covering highly prospective license areas with potential for major new copper, nickel, gold, silver and other strategic mineral discoveries.
The JV will also deploy IE’s proprietary Typhoon™ technology and CGI software that will strengthen Ma’aden’s exploration capabilities and grow its resource base and production pipeline.
As part of the agreement, Ma’aden will gain approximately 10.2 million common shares in IE, representing 9.9% of Ivanhoe Electric Inc., for $126.5 million with a top-up option to maintain its 9.9% ownership.
The formation of the JV and the acquisition of 9.9% shares in IE will only be effective after fulfilling certain conditions.
Commenting on the development, Robert Wilt, CEO of Ma’aden, said, “We are launching one of the largest exploration programs in the world in partnership with Ivanhoe Electric. It’s great to see companies like IE recognize the scale of the opportunity here. We have only scratched the surface of the potential in the Kingdom, and we need to explore faster, smarter and cover more ground to meet our long-term growth objectives.”