The Reko Diq project is expected to yield 31 million tonnes of gold and copper worth over $181 billion at the existing market value of both the precious metals.
The updated feasibility study of Reko Diq shows that the mine is expected to yield production of 13.1 million tonnes of copper and 17.9 million ounces of gold, over its 37-year life.
Pakistan’s massive Reko Diq copper and gold mining project has reached a key milestone with the completion of its feasibility study. The study presents a 37-year mine life, with an overall capital investment of nearly $5.6 billion, without adding the financing costs and inflation. The project’s long-awaited progress signals a major step in unlocking Pakistan’s rich mineral resources, which have the potential to significantly boost the national economy.
Phased Development and Production Goals
Reko Diq’s development is likely to occur in two phases. Phase 1, set to start production in 2028, will process 45 million tonnes of mill feed annually. By 2034, Phase 2 will be operational, doubling the processing capacity to 90 million tonnes per year. Over its lifespan, the mine is expected to produce an impressive 13.1 million tonnes of copper and 17.9 million ounces of gold—a game-changer for Pakistan’s mineral industry.
Financing and Investment Structure
The first phase of the project will be financed through a limited-recourse project financing facility of up to $3 billion, while the remaining investment will be covered by shareholder contributions. Financing for Phase 2 is still under discussion and may involve revenue from initial production, additional project financing, and more shareholder investments if required.
Reko Diq is jointly owned by a consortium, with Barrick Gold Corporation holding a 50% stake as the project operator. The remaining 50% is split between Pakistani stakeholders, including:
• Oil and Gas Development Company Limited (OGDCL)
• Three state-owned enterprises (holding a collective 25% stake)
• The Government of Balochistan (25%)
OGDCL’s Board of Directors has approved an increase in its funding commitment, raising its total contribution to $627 million, which includes financing costs. The board has also given ratification to seek additional project financing, with shareholder equity contributions estimated at $349 million.
What will be the economic impacts of this?
Renowned analysts of the industry keep on believing that Reko Diq’s high costs will be offset by increased revenues with the rise of gold and copper prices, making it a financially viable project. The approval of financing commitments by the major stakeholders marks a crucial step forward in bringing one of the world’s largest untapped copper-gold deposits into production.
This project is anticipated to produce various other positive results, such as
- Generate thousands of jobs
- Attract foreign investment
- Help position Pakistan as a key player in the global mining industry
With production now on the horizon, Reko Diq is set to play a major role in shaping Pakistan’s economic future.