The Economic Coordination Committee (ECC) of the Cabinet has approved an increase in the cost and development plan for the Reko Diq project, raising the total valuation from $6.2 billion to $6.7 billion. This upward revision of nearly $500 million follows ongoing negotiations with the Kingdom of Saudi Arabia (KSA), which has shown interest in acquiring a stake in the multibillion-dollar project.
While the Ministry of Finance issued a statement confirming the revision, it did not provide specifics on the escalation in the project’s valuation. The meeting, chaired virtually by Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, took place on Tuesday while he was attending the Boao Forum for Asia in China.
The session also saw participation from other key ministers, including Minister for Petroleum Mr. Ali Parvez Malik, Minister for Commerce Jam Kamal Khan, and Minister for the Board of Investment, Qaiser Ahmed Sheikh. Senior officials from relevant ministries were also in attendance.
The revised valuation is expected to pave the way for the sale of federal government stakes to KSA, with the deal possibly concluding within the current fiscal year 2024-25. However, no final agreement has been reached as of yet.
The ECC made several key changes to the project’s development plan, including an expansion in scope and updated financial commitments, driven by inflation and an increase in project capacity, energy mix, and infrastructure, such as alternative water supply and new processing plants and machinery.
The ECC highlighted the factors driving the cost increase and reiterated its full support for the Reko Diq project, emphasizing its importance to national economic interests. The committee also instructed the ministries of Petroleum and Finance to maintain close coordination to ensure timely execution of the project.
In addition to Reko Diq, the ECC approved a supplementary grant of Rs 200 million for the development of the Pakistan Sports Board (PSB) Coaching Centre at Skardu, with the condition that the facility serves its intended purpose of providing sports and high-altitude training.
