The Saudi Arabian Mining Company (Maaden) has signed agreements to establish 4 companies for exploration and investment in mineral assets.
According to Maaden's statement on the Saudi Tadawul website, the company announced the signing of an agreement with the Public Investment Fund to establish a company to invest in mining assets at the international level to secure strategic minerals.
Under the terms of the agreement, Ma'aden's ownership in the company will be 51%, while the fund's ownership will be 49%. The company's initial paid-up capital will amount to 187.5 million riyals.
Ma'aden will pay its stake in the company amounting to 95.625 million riyals from its own resources. Ma’aden and the Fund also agreed that when the company’s business develops and needs additional financing, Ma’aden and the Fund will commit to financing the company with a total amount of about 11.95 billion riyals, and accordingly, the maximum investment of Ma’aden in the company will be about 6.095 billion riyals, unless the parties agree on otherwise in the future.
The company's strategy will initially be based on investing in the iron ore, copper, nickel and lithium sectors as a non-operating partner with minority stakes. This will contribute to ensuring the security of domestic mineral supplies and positioning the Kingdom as a major partner in the global supply chain. The company is expected to have a positive financial impact on Ma'aden in the long term. Ma'aden will announce substantial developments in this regard at a later stage.
It is noteworthy that the Fund is considered a related party being the largest shareholder in Ma'aden, which owns 67.18% of Ma'aden's shares.
Ivanhoe Convention
The Saudi Arabian Mining Company, Maaden, signed the main clauses agreement with Ivanhoe Electric Inc. Ivanhoe, listed on the Toronto and New York Stock Exchanges, to acquire about 10.208 million shares, representing 9.9% of the ordinary shares of Ivanhoe, for a total amount of approximately 474 million riyals ($126.4 million). , at a price of 46.43 riyals ($12.38) per share upon completion of the deal, which is expected to be completed at the end of the first quarter of 2023.
The deal will also be financed from Ma’aden’s own resources, and a company will be established in Saudi Arabia owned by Ma’aden by 50% and by Ivanhoe by 50%, for the purpose of exploration and development of mining projects in the Kingdom. According to the Master Terms Agreement, the proceeds from the acquisition paid by Ma'aden will be used to invest in the operating capital and general use of Ivanhoe, to purchase Typhoon units, and to invest in mineral exploration in the Kingdom within the lands that will be made available by Ma'aden for this purpose.
The joint venture between Ma’aden and Ivanhoe will provide the possibility of using Typhoon technology, which conducts geophysical surveys, by using high-energy transmitters to detect the potential presence of sulfur minerals containing copper, nickel, gold and silver. It is expected to help speed up exploration and reduce risks. And the cost of exploration for Ma’aden, through the use of the most accurate and powerful geophysical survey techniques in the global market.
Maaden stated that it is in the process of negotiating the final documents related to the deal with Ivanhoe, and its financial impact is expected to be positive for Maaden in the long term, and any material developments will be announced later.
Gold exploration
Ma’aden announced the signing of a partnership agreement with Barrick Gold T7 Limited, a subsidiary of Barrick Gold Company, to establish a limited liability company, to be owned 50% by Ma’aden and 50% by Barrick, with the aim of accelerating the process of resource exploration in line with the business strategy in the Umm al-Dummar area.
Ma'aden will initially contribute a total of $7.6 million (28.5 million riyals) from its own resources to the exploration work. The headquarters of the new company will also be in Saudi Arabia.
Ma’aden also signed a partnership agreement with Barrick Gold (Singapore) Limited, a subsidiary of Barrick Gold Company, to establish a limited liability company for exploration and exploration in the south of Jabal Sayid, where the license is an asset owned by Ma’aden, and the ownership of the new company will be 50% for Ma’aden and 50% for Ma’aden. For Barrick, the aim of its establishment is to accelerate exploration work in the south of Jabal Sayid. The headquarters of the new company will be in the Kingdom.
Phosphate project 3
Maaden announced the signing of an engineering, procurement and construction management services contract with WorleyParsons Arabia Limited and Giza International, at a value of 1.043 billion riyals ($278 million).
Under the contract, WorleyParsons Arabia Limited and Giza International will carry out the engineering, procurement and construction management for the construction of the Phase 3 Phosphate Project, which will produce 1.5 million tons per annum of phosphate fertilizers. The integrated production complex will be built in the cities of Waad Al-Shamal and Ras Al-Khair for mining industries.
