The Saudi Arabian Mining Company (Ma’aden) announced on Monday the signing of a master clauses agreement to buy 9.9% of the shares of Ivanhoe Electric Inc.
The agreement will also establish a 50/50 exploration joint venture (JV) in the Kingdom to contribute in conducting one of the largest exploration programs in the world.
This joint agreement will grant Ma’aden the rights to use Ivanhoe’s Typhoon TM geophysical surveying technology, which will in turn accelerate the exploration of mineral sites in the Kingdom, valued at $1.3 trillion.
This step will help strengthen Saudi Vision 2030, which views mining as a third pillar of the Saudi economy. It is also considered a key supporter of Ma’aden’s ambitious strategy, which aims to boost its growth tenfold by 2040 and to exploit the mineral resources in the Kingdom.
Ma'aden and Ivanhoe Electric will conduct exploration operations on an estimated area of 48,500 square kilometers of licensed sites in the Kingdom - an area larger than the size of Denmark. The exploration operations aim to discover strategic minerals, such as copper, nickel, gold and silver.
Ma'aden will be able to employ Typhoon technology, which is a revolution in geophysical surveys and 3D data processing (CGI).
As part of the agreement, Ma’aden will acquire approximately 10.2 million common shares in Ivanhoe Electric, or 9.9% of the company, for $126.5 million with a top-up option to maintain its 9.9% ownership. Out of this amount, $66 million will be allocated and invested to establish the exploration JV in the Kingdom and finance its exploration activities and programs.
In addition to the acquisition of three new-generation Typhoon machines, Ma'aden will also be granted the right to appoint a candidate to the board of directors of Ivanhoe Electric.
The agreement will only be executed after certain conditions are met.
Ma’aden CEO Robert Wilt said: “Ma’aden is working on one of the largest mining exploration programs in the world in partnership with Ivanhoe Electric and this agreement is an important breakthrough to explore the potential mineral resources in the Kingdom”.
“Therefore, we need to carry out survey and exploration activities in faster and smarter ways, and cover more ground to meet our long-term growth objectives, which will be enabled by the Typhoon technology,” he added.
Wilt noted that Typhoon technology would contribute to accelerating Ma’aden exploration efforts by six times and reduce the risks associated with them, adding that it will lead the Kingdom to be a significant global hub for mining exploration.
“This is going to help put us on track to meet our tenfold growth targets and fast track development of the Kingdom’s mineral riches,” Wilt said.
Ivanhoe Electric Executive Chairman Robert Friedland expressed his excitement to finalize transaction terms with Ma’aden and begin the important work of minerals exploration in Saudi Arabia.
He said that through the Typhoon technology, the Computational Geosciences’ machine-based learning software and the combined talents of the highly experienced team will have all the tools necessary to conduct a transformational exploration program for electric and precious metals in the Kingdom.
