Pakistan has received over $5 billion in financing commitments from multinational donors for the Reko Diq copper and gold mining project in Balochistan, surpassing the project’s estimated funding requirement of $3 billion, The Express Tribune reported, citing sources.
Key donors include the Asian Development Bank (ADB), Islamic Development Bank (IDB), International Finance Corporation (IFC), and US Exim Bank, with additional offers from development agencies in Germany and Denmark.
The financial close of the project is in its advanced stages, with Petroleum Minister Ali Pervaiz Malik, supported by the Special Investment Facilitation Council (SIFC), leading efforts to expedite the project’s development. The US Exim Bank has pledged significant capital, with no cap on the financing, addressing Pakistan’s need for funds.
Recently, the Ministry of Petroleum also organised a webinar with the US Embassy to attract American investors to the mining sector.
Reko Diq, located in Balochistan’s Chagai district, holds the world’s largest untapped copper reserves. The project, revived by Canada’s Barrick Gold, is expected to begin copper and gold production by 2028. The initial investment of $5.5 billion is expected to generate $74 billion in free cash flow over 37 years.
Annual exports are anticipated to generate $2.8 billion, with thousands of jobs created. A planned expansion will further increase copper production to 400,000 tonnes and gold output to 500,000 ounces per year, with an additional $3.5 billion investment.
Under an intergovernmental agreement, Pakistan’s federal cabinet has approved the sale of a 15% stake in the Reko Diq project to Saudi Arabia’s Manara Minerals. This deal is expected to involve an investment of $1 billion.
The logistics of the project will be managed through a railway track built in partnership with Pakistan Railways, facilitating the transportation of mining supplies to Karachi and the export of copper concentrate and gold.
Pakistan’s mineral sector, with abundant resources, is becoming increasingly attractive to foreign investors, promising significant contributions to economic growth and industrial development.
International ‘donors’ or ‘lenders / investors’. I am sure they are not donating these amounts to Pakistan for free and there will be terms and conditions for the return of lent money. There are no free lunches in the world except in Pakistan where the masses suffer from hunger while some enjoy ‘parathas’ day and night.