Saudi Arabian Mining Company, one of the biggest miners in the Arab world, has signed an agreement with Vancouver's Ivanhoe Electric to purchase 9.9 per cent stake in the company for $126.5 million.
As part of the deal, Ma'aden will acquire nearly 10.2 million common shares in IE.
Ma'aden, as the Saudi miner is known, has also formed a 50/50 joint venture with the American technology and mineral exploration company to undertake one of the largest exploration programmes, the company said.
The JV will spend $66 million of the $126.5 million funding exploration activities and buying three new-generation Typhoon machines.
The agreement will let Ma'aden access IE’s Typhoon geophysical survey technology that will accelerate the exploration of Saudi Arabia’s lands, estimated to hold $1.3 trillion of untapped minerals, it added.
The JV will explore at least 48,500 square kilometres of land, covering prospective licence areas with potential for new copper, nickel, gold, silver and other strategic mineral discoveries.
“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,” said Ma'aden chief executive Robert Wilt.
“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 10 times growth targets.”
Ma'aden's exploration programme is driven by Saudi Arabia’s Vision 2030, which positions mining as a third pillar of the country’s economy. Under its new corporate strategy, Ma'aden aims to grow tenfold by 2040 and to move into strategic minerals to fuel the growth of downstream industries in the kingdom, the Arab world’s biggest economy.
“We are excited to finalise our transaction terms with Ma'aden and begin the important work of minerals exploration in the kingdom,” IE’s executive chairman Robert Friedland said.
“With our Typhoon technology, our computational geosciences’ machine-based learning software, and the combined talents of our highly experienced team … we have all the tools necessary to conduct a transformational exploration programme for electric and precious metals in the kingdom.”
The formation of the joint venture and the acquisition of 9.9 per cent shares in IE will only be effective after fulfilling certain conditions, the companies said.
Ma'aden operates several extraction sites and mines in Saudi Arabia to produce gold, copper, iron ore and strategic minerals.
In January, it teamed up with the kingdom’s sovereign wealth fund, the Public Investment Fund, to pursue global mining investment opportunities.
It reported a more than 87 per cent jump in its full-year 2022 net profit to 2.13 billion Saudi riyals ($3.23 billion), boosted by higher sales and higher average prices of its products.