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RIYADH: Saudi Arabian Mining Co. said on Wednesday it agreed to form a joint venture with the Kingdom’s sovereign wealth fund to invest in mining assets globally.  

Also known as Ma’aden, the Gulf’s largest miner will own 51 percent of the venture while the Public Investment Fund will own 49 percent, the company said in a regulatory filing.  

Ma’aden said the new venture’s strategy “will initially be to invest in the iron ore, copper, nickel and lithium sectors as a non-operating partner taking minority equity positions.”  

“This will provide physical offtake of critical minerals to ensure supply security for domestic minerals downstream sectors and positioning Saudi Arabia as a key partner in global supply-chain resilience,” it added in the filing.  

The new company’s initial paid-up capital will amount to SR187.5 million ($50 million), of which Ma’aden will finance SR96 million as its share of the investment.   

Ma’aden and PIF agreed to contribute additional funding of up to SR11.95 billion if required by way of capital increases or otherwise as the business of the new company develops.   

Ma’aden stated that its maximum contribution shall be SR6 billion unless both agree otherwise in the future.  

In a separate statement, Ma’aden also said it agreed to acquire a 9.9 percent stake in American minerals exploration and development firm Ivanhoe Electric and form a separate joint venture with Ivanhoe to explore and develop mining projects in Saudi Arabia.  

Speaking at the Future Minerals Forum in Riyadh on Jan. 11, Ma’aden CEO Robert Wilt said that the cooperation with Ivanhoe will help Saudi Arabia to uncover the true mineral resources in the Kingdom. 

“We will have a joint venture with Ivanhoe to help unearth the potential and find out what the true mineral resources are,” said Wilt. 

In a separate press statement, Ivanhoe Electric said it had signed a heads of terms agreement with Ma’aden, on the sidelines of the FMF, to explore copper, gold, silver, and electric metals in Saudi Arabia. 

The statement further noted that the joint venture would provide the possibility of using the Typhoon technology that performs geophysical surveys. 

Ivanhoe Electric further added that the joint venture will operate through an equally constituted board of directors and technical committee. 

In a statement to Tadawul, Ma’aden said the acquisition will take place for a total amount of SR474 million ($126.4 million). 

According to the statement, the deal is expected to be finalized by the end of the first quarter of 2023, and it will be financed from Ma’aden’s resources. 

Ivanhoe Electric is a technology firm listed on the Toronto Stock Exchange and New York Stock Exchange. 

Wilt further noted that Ma’aden has inked another partnership agreement with Barrick Gold Limited, a subsidiary of Barrick Gold Corp. Under the deal, a new limited liability company will be set up in Umm Ad Damar to accelerate mineral exploration activities in the Kingdom. 

In a statement to Tadawul, Ma’aden said it would inject SR28.5 million from internal resources into the exploration activities. 

During his speech at the FMF, Wilt also added that Saudi Arabia is on a path of transformation, and the mining sector is serving as the third pillar of the Kingdom’s economy.