Ivanhoe Electric (TSX: IE; NYSE-AM: IE), the latest endeavour of mining magnate Robert Friedland, is joining with Saudi Arabia’s state-owned miner Ma’aden to explore for copper, gold, silver and electric metals considered key for the transition to green energy.
The companies are creating a 50:50 joint venture that will operate for five years, and may be extended for up to 10 years.
As part of the exploration deal, Ma’aden will invest US$126.4 million ($169.6 million) in Ivanhoe Electric equity, granting the Gulf’s largest miner a 9.9% interest in Ivanhoe Electric, which owns properties in Arizona, Utah and Montana, along with a battery storage business.
Ma’aden will also make available about 48,500 sq. km of land in Saudi Arabia for exploration, with Ivanhoe Electric providing its proprietary Typhoon technology under an exclusive licence.
The minerals exploration and development firm, which last month moved its headquarters from Canada to the United States, will contribute US$66 million ($88.5 million) to the JV, $13 million of which will be used to acquire three new generation Typhoon machines.
Ivanhoe’s electrical pulse-powered geophysical surveying transmitter technology can detect metals buried as deep as 1.5 km underground. This makes it an ideal tool for surveying many parts of Saudi Arabia, where the bedrock is hidden by a sand and gravel cover that can go deeper than 1 km, the company said.
The partners will look for battery metals such as copper, nickel and lithium, but will also search for gold, silver and iron ore.
The deal comes as the second edition of the Future Minerals Forum kicks off in the Saudi capital Riyadh. The three-day conference is expected to draw thousands of people, including major figures from government and the mining industry for discussions on critical minerals and the transition towards cleaner energy.
Friedland made his fortune from the Voisey’s Bay nickel project in Canada in the 1990s. Since then, he has been involved in some of the biggest mineral discoveries in the world, including the giant Oyu Tolgoi copper mine in Mongolia and the Kamoa-Kakula copper mine in Democratic Republic of the Congo.
Forbes estimates Friedland’s holdings are worth $2.9 billion as of January 2023.
JV with Barrick
Separately, Ma’aden inked a new JV deal with Canada’s Barrick Gold (TSX: ABX; NYSE:GOLD) for two prospective exploration projects in the Jabal Sayid South and Umm Ad Damar licence areas.
The agreement expands Barrick’s exploration footprint in Saudi Arabia and opens up potential synergies with the neighbouring Jabal Sayid mine, an existing 50/50 JV between Barrick and Ma’aden.
The Jabal Sayid copper operation is located 350 km north-east of Jeddah, and the first shipment of copper concentrate went out in December 2015, Barrick said.
The news comes as copper topped US$9,000 per tonne on Wednesday for the first time since June 2022 on optimism over a post-Covid-19 recovery in China, which consumes more than half of the world’s copper.
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