Saudi Arabian Mining Co. (Ma’aden) has finalised an agreement with Ivanhoe Electric Inc. (IE) to purchase 9.9% shares in the company for $126.5 million and form a 50/50 joint venture to undertake one of the largest exploration programmes ever conducted.

The deal will provide Ma’aden, through the joint venture, with the means to accelerate the exploration of Saudi Arabia’s lands, estimated to hold $1.3 trillion of untapped minerals, the company said in a statement on Monday.

The joint venture (JV) with Ivanhoe Electric will explore an area larger than Denmark, covering highly prospective license areas with potential for major new copper, nickel, gold, silver and other strategic mineral discoveries.

Robert Wilt, CEO of Ma’aden, said: “This is going to help put us on track to meet our 10x growth targets and fast track development of the Kingdom’s mineral riches.”

As part of the agreement, Ma’aden, which is one of the largest multi-commodity mining and metals companies in the Middle East, will acquire approximately 10.2 million common shares in IE, representing 9.9% of IE, with a top-up option to maintain its 9.9% ownership.

“The JV will deploy $66 million of the $126.5 million to fund exploration activities and the purchase of three new generation Typhoon machines,” the company said.

Ma’aden has been granted the right to appoint a nominee to the IE board of directors.

The formation of the JV and the acquisition of shares in IE will only be effective after fulfilling certain conditions.

(Reporting by Brinda Darasha; editing by Imogen Lillywhite)