US-based exploration and development company Ivanhoe Electric (IE) on Wednesday announced a 50:50 joint venture (JV) with Saudi Arabian Mining Company (Ma’aden) to explore for copper, gold, nickel and silver in that country.

This forms part of an agreement that will see Ma'aden subscribing to new shares in IE resulting in a 9.9% equity interest for $126-million.

Under the transaction terms, Ma'aden will obtain the right to appoint one independent director to the IE board of directors and will be issued with about 10.2-million new common shares in IE at a price of $12.38 a share.

The heads of terms was signed at the Future Minerals Forum in Riyadh, and is expected to be completed by the end of the first quarter.

The JV between Ma'aden and Ivanhoe will explore about 48 500 km² of selected licence areas that demonstrate excellent potential.

IE will commit $66-million from funds raised through the share subscription to the JV to fund the purchase of three new generation Typhoon machines and the exploration of prospective lands to be provided by Ma'aden for metallic minerals within the Kingdom.

Through the JV, Ma'aden will obtain royalty-free access to IE's proprietary Typhoon technology, which conducts geophysical surveys using high-powered transmitters to detect the presence of sulphide minerals containing copper, nickel, gold and silver. This will help accelerate, derisk and advance Ma'aden's exploration lands being made available to the JV, thereby enabling Ma'aden to realise value from its exploration assets.

"Ma'aden's strategic investment in Ivanhoe Electric is a critically important moment in our journey to become a leading supplier of strategic minerals, which will fuel global economic growth over the coming decade. Through Ma'aden, Saudi Arabia is making an invaluable contribution to fast-developing new industries across the world characterized by technological advancement,” said Ma’aden CEO Robert Wilt.

"We are proud to partner with Ma'aden and the amazing young motivated women and men of Saudi Arabia on this journey to explore the significant mineral wealth of the Kingdom, especially with the blessings our collaboration may bring to realizing Vision 2030," said IE executive chairperson Robert Friedland.