Saudi Arabian Mining Company (Ma’aden) has finalised its agreement with Ivanhoe Electric Inc (IE) to purchase a 9.9% stake in the company and form a 50/50 joint venture to undertake what it says is one of the largest exploration programs ever conducted.
The deal will provide Ma’aden, through the joint venture, with access to IE’s Typhoon™ geophysical survey technology, which will accelerate the exploration of Saudi Arabia’s lands, estimated to hold $1.3 trillion of untapped minerals, the company says.
Ma’aden’s exploration program is driven by the Kingdom’s Vision 2030, which positions mining as a third pillar of the Saudi economy. 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 joint venture (JV) with Ivanhoe Electric will explore at least 48,500 sq.km of land, covering highly prospective licence areas with potential for major new copper, nickel, gold, silver and other strategic mineral discoveries, Ma’aden says. The JV will deploy IE’s proprietary Typhoon technology and CGI software that, it says, will strengthen Ma’aden’s exploration capabilities and grow its resource base and production pipeline.
As part of the agreement, Ma’aden will acquire 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 JV will deploy $66 million of the $126.5 million to fund exploration activities and the purchase of three new generation Typhoon machines. Ma’aden has also been granted the right to appoint a nominee to the IE board of directors.
The formation of the JV and the acquisition of 9.9% shares in IE will only be effective after fulfilling certain conditions.
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 recognise 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. IE’s Typhoon technology will enable us to accelerate our exploration efforts by six times, and de-risk and advance the development of a significant exploration hub in the Kingdom. This is going to help put us on track to meet our 10x growth targets and fast track development of the Kingdom’s mineral riches.”
Ivanhoe Executive Chairman, Robert Friedland, added: “We are excited to finalise our transaction terms with Ma’aden and begin the important work of minerals exploration in the Kingdom of Saudi Arabia. Our joint venture will embark on the largest exploration program ever conducted using our highly powerful and disruptive Typhoon geophysical surveying system. With our Typhoon technology, our Computational Geosciences’ machine-based learning software, and the combined talents of our highly experienced team of women and men, we have all the tools necessary to conduct a transformational exploration program for electric and precious metals in the Kingdom of Saudi Arabia. The potential for future discoveries is extraordinary.”
