Pakistan secures $3.5bn financing for Reko Diq mining project: report

Pakistan has finalised a $3.5 billion financing package with six major international financial institutions for the development of the Reko Diq copper-gold project in Balochistan, marking a key milestone for one of the country’s largest mineral ventures, The Express Tribune reported. 

The financing agreement involves commitments from the US EXIM Bank, Asian Development Bank, International Financial Institutions, International Development Association, and the European Bank, officials said. 

The deal was signed by project sponsors, the federal government, and Barrick Gold Corporation, with final board approvals from the lenders still pending. Once approved, fund disbursement is expected to begin within 45 to 90 days, subject to fulfillment of agreed conditions.

The terms of the agreement allow a grace period of four to five years for repayment, with loans to be serviced over a 12-year period at a single-digit interest rate, providing Pakistan with a favourable borrowing framework. Officials indicated that if prerequisites are met on schedule, the first tranche could be released within two months.

Key stakeholders in the project include Barrick Gold, the Balochistan government, Oil and Gas Development Company Limited (OGDCL), and Pakistan Petroleum Limited (PPL). Under the equity structure, Barrick Gold will retain 55 per cent, OGDCL and PPL will jointly hold 27.7 per cent, and Balochistan will maintain a 16.6 per cent stake.

The total project cost is estimated at $7.7 billion, with production expected to start by the end of 2028. Officials project total revenues of approximately $53 billion over the project’s lifetime. 

Balochistan is expected to receive $11 billion in fiscal revenue, including $6 billion as its provincial share and $9 billion via equity held by Balochistan Mineral Resources Limited. The federal government is projected to earn around $11 billion in fiscal revenues.