Saudi venture buys 10% of world’s largest copper maker

• Ma’aden-PIF venture Manara takes 10% stake in Vale Base Metals
• Brazilian miner Vale’s subsidiary VBM valued at $26bn
• VBM plans to increase copper production from 350 to 900 tonnes

Manara Minerals, a joint venture between Saudi Arabian Mining Co (Ma’aden) and the sovereign Public Investment Fund (PIF), will acquire a stake in Brazilian miner Vale’s subsidiary.

Manara Minerals will buy 10 percent of Vale Base Metals Limited (VBM), while US investment firm Engine No. 1 will acquire three percent. The two agreements are worth $3.4 billion, taking VBM’s enterprise value to $26 billion.

The closing is expected to take place by the first quarter of 2024, subject to regulatory approvals.

• Saudi hunts for critical minerals in energy transition
• Saudi Arabian Mining Co profit slumps 80% in Q1
• Mining the Middle East’s rich seam of copper

“Manara Minerals’ investment into VBM marks our first major investment into the global mining sector,” said Robert Wilt, executive director of Manara Minerals and CEO of Ma’aden.

“We see these strategic investments as a major milestone in our path to accelerate accretive growth in our energy transition metals business platform,” added Vale’s CEO Eduardo Bartolomeo.

VBM is North America’s largest integrated nickel producer and the largest copper business globally. The company has secured agreements to supply low-carbon and high purity nickel to major automakers as it focuses on expanding mine life and developing growth projects across the portfolio.

The stake sale will fast-track VBM’s expected $25 to $30 billion capital programme over the next decade. It increases possible copper production from about 350 metric tonnes per year to 900 metric tonnes per year. Nickel production will rise from 175 metric tonnes per year to more than 300 metric tonnes per year.

Vale has earlier signed contracts to supply nickel to major automobile manufacturers, including Tesla and General Motors.

Ma’aden recently bought a 9.9 percent stake in US minerals exploration company Ivanhoe Electric as part of a joint venture exploring an area in the kingdom larger than Denmark.

The $126 million deal includes a $66 million joint venture where Ma’aden will use Ivanhoe’s Typhoon geophysical surveying technology to mine for copper, nickel, gold and silver in an area covering around 48,500 sq km.