Saudi Arabian state miner Ma’aden inked a major new deal with the kingdom’s sovereign wealth reserve the Public Investment Fund (PIF) at the Future Minerals Forum 2023 in Riyadh this week.
The deal was among more than 20 agreements and memoranda of understanding signed between the state mining entity and other international companies at the three-day summit, Ma’aden said in a news release Thursday.
The Ma’aden-PIF agreement would see the formation of a new company, funded with initial capital of US$50 million to invest globally into upstream strategic minerals opportunities, starting with iron ore, copper, nickel and lithium as a “non-operating partner” in minority equity positions.
That structure, Ma’aden said, would allow for physical offtake of critical minerals, ensuring security of supply for downstream sectors in the kingdom.
The company, which was not named, will be owned 51% by Ma’aden and 49% by PIF.
Ma’aden CEO Robert Wilt said the formation of the company is an important step in the development of Saudi Arabia as an ally in securing critical metals.
“The global energy transition relies on the strategic minerals needed for renewable energy and battery storage, and our focus on these will give us a foothold in the global commodity value chain, where major supply constraints are combined with growing demand,” he said.
The new entity will incorporate once approvals are received from authorities and after certain conditions in the JV agreement are met.
In addition to agreements reached at the Forum with such high-profile miners as Ivanhoe Electric (TSX: IE; NYSE-AM: IE), Barrick Gold (TSX: ABX; NYSE: GOLD), and Eurasian Resources Group, Ma’aden also made deals with Nokia, Shell and Bechtel on integrating new technologies into mining and exploration towards the goal of reducing energy consumption and advancing decarbonization.
Wilt added that attracting new development partners to the kingdom will help introduce new technologies into its operations and diversify its upstream products. “This will create opportunities for knowledge and technology transfer that will deepen the talent pool in Saudi Arabia and open up new opportunities to develop the Kingdom’s abundant mineral resources,” the CEO said.