US EXIM approves $1.25bn as Reko Diq secures half of $3.5bn debt financing

Pakistan’s largest mining project has cleared a major financing hurdle after the US Export–Import (EXIM) Bank approved a $1.25 billion facility, helping secure half of the $3.5 billion debt requirement for the Reko Diq copper-gold project, The News reported. 

Canada’s Export Development Canada (EDC) is co-financing alongside EXIM, taking the combined US–Canada contribution to $1.4 billion. Both agencies will supply equipment and services for mine construction.

Officials now expect full financial closure of the $7.7 billion venture in the first two weeks of December, ahead of a Reko Diq Mining Company (RDMC) board meeting on December 9, where final approval is anticipated.

The project’s capital expenditure was originally estimated at $6.9 billion, but lenders sought a revised figure of $7.7 billion to account for contingencies and risk coverage.

According to officials involved in ongoing negotiations, $3.5 billion has already been secured from multilateral institutions and export credit agencies. 

Other confirmed commitments include $700 million from the International Finance Corporation (IFC) and $300 million from the Asian Development Bank (ADB). The Japan Bank for International Cooperation (JBIC) is preparing close to $300 million in import financing, while three European institutions, Germany’s Euler Hermes and KfW, and Sweden’s EKN, will jointly extend $900 million tied to off-take agreements for copper and gold. Collectively, these contributions represent around 30 per cent of the financing package.

Officials said discussions on interest rates are ongoing, noting that terms vary across lender categories. In case of disputes, agreements designate the London Court of International Arbitration under English law as the binding forum.

The financing plan follows a 50:50 debt-to-equity structure. RDMC, the project’s special-purpose company, is owned by Barrick Gold Corporation (50%), the Government of Pakistan (25%) through OGDCL, PPL and GHPL, and the Government of Balochistan (25%), which includes a 10 per cent free-carried interest and a 15 per cent fully funded stake.

In a parallel infrastructure commitment, RDMC has pledged $390 million in bridge financing to upgrade Pakistan Railways’ Main Line-2 and Main Line-3, ensuring efficient transport of mined materials to Port Qasim ahead of production, expected in 2028.