Islamabad: Pakistan received a USD 5 billion offer from multinational donors and agencies to execute the multibillion-dollar Reko Diq copper and gold mining project in the Balochistan region, according to a media report.
The commitments received from foreign donors were more than the funding requirement for the Reko Diq project, which is estimated at USD 3 billion, sources told The Express Tribune newspaper.
The donors included the Asian Development Bank (ADB), Islamic Development Bank (IDB), International Finance Corporation (IFC) and US Exim Bank. Development agencies from Germany and Denmark have also offered financing.
According to sources, the financial close of the project is at an advanced stage and Petroleum Minister Ali Pervaiz Malik, backed by the Special Investment Facilitation Council (SIFC), is taking the lead and making aggressive efforts to expedite work, which will pave the way for exploring the entire potential of the mining sector.
It is interesting to note that the US Exim Bank has offered no cap on financing and is ready to provide capital, which Pakistan and other partners desperately need.
The Ministry of Petroleum recently organised a webinar in association with the US embassy to woo American investors to participate in mining projects in Pakistan.
State-owned exploration giant Oil and Gas Development Company (OGDC) is a key partner in the Reko Diq project, and efforts are underway to kick off work.
Pakistan is rich in mineral resources that hold immense potential for fuelling economic growth and industrial development. The country’s vast reserves of minerals, including coal, copper, gold, iron ore, chromite and precious stones, provide a solid foundation for the mining sector to thrive and contribute to economic development.
Its mineral-rich landscape covers an outcrop area of approximately 600,000 square kilometres. With 92 known minerals, 52 of which are commercially exploited, Pakistan produces an estimated 68.52 million metric tonnes of minerals annually.
The sector supports over 5,000 operational mines and 50,000 small and medium enterprises (SMEs), providing direct employment to 300,000 workers.
Some of the country’s most notable mineral reserves include the world’s second-largest salt mines, the fifth-largest copper and gold deposits and significant coal reserves. Furthermore, Pakistan holds vast quantities of bauxite, gypsum and precious stones such as ruby, topaz, and emerald, which offer considerable export potential.
Despite the potential, the mineral sector currently contributes around 3.2% to the gross domestic product, with exports accounting for only 0.1% of the world’s total. However, with increasing exploration, foreign investment and infrastructure improvements, the mining industry is poised for significant expansion.
The local mining sector is increasingly attracting foreign investment, with global firms eyeing the untapped mineral reserves.
The Reko Diq copper and gold project, located in the Chagai district of Balochistan, has the world’s largest untapped copper reserves and stands as a milestone for Pakistan’s mining ambitions.
The project, revived by Canada’s Barrick Gold, is expected to start producing copper and gold by 2028, with an initial investment of USD 5.5 billion.
According to Mark Bristow, CEO of Barrick Gold, which owns a 50% stake in the project, the reserves are expected to generate USD 74 billion in free cash flow over the next 37 years, according to the paper.
PTI
