Saudi Arabian Mining Company (Ma’aden) and Ivanhoe Electric have signed a definitive agreement and finalised terms to form a 50-50 joint venture (JV) to explore copper, gold, nickel, silver, and other electric metals in Saudi Arabia.

As part of the agreement, Ma’aden will invest $126.5m in Ivanhoe Electric to acquire nearly 10.2 million common shares of the latter, representing a stake of 9.9%.

The JV is expected to utilise $66m from the proceeds to fund exploration activities and purchase three new generation Typhoon machines.

The US-based mineral exploration company will operate the JV during the exploration phase. Its partner Ma’aden is expected to become the operator for the development of any commercially viable deposits discovered and designated specifically by the JV.

Ma’aden CEO Robert Wilt said: “We are launching one of the largest exploration programmes 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.”

According to the Saudi Arabian mining company, the JV will explore at least 48,500km2 of land covering highly prospective license areas in Saudi Arabia.

Besides, the JV is expected to deploy Ivanhoe Electric’s Typhoon technology and CGI software to bolster Ma’aden’s exploration capabilities along with expanding its resource base and production pipeline.

Ivanhoe Electric executive chairman Robert Friedland said: “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 programme for electric and precious metals in the Kingdom of Saudi Arabia.”

Both parties joined forces to form the JV in January 2023.

The transaction, which is subject to the approval of a supplemental listing application by the New York Stock Exchange and the necessary corporate and regulatory formalities in Saudi Arabia to incorporate the JV, is expected to close in Q2 2023.