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Released July 25, 2022 | GALWAY, IRELAND
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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Canada's Barrick Gold Corporation (NYSE:GOLD) (Toronto, Canada) is close to finalizing a deal with Pakistan on the US$7 billion Reko Diq copper-gold project.
Located in the province of Balochistan, close to the borders of Iran and Afghanistan, Reko Diq is considered to be one of the world's largest undeveloped copper-gold deposits. However, the proposed project has been on hold since 2011 over disputes with the government regarding the licensing process. The project got back on track earlier this year when Barrick reached an out-of-court settlement, under which an US$11 billion penalty against Pakistan was waived. When fully constructed it will be capable of producing up to 200,000 tonnes of copper and 250,000 ounces of gold per annum.
After a meeting last week between Pakistan's Finance Minister, Miftah Ismail, and Barrick president and chief executive, Mark Bristow, they said that they shared a "clear vision of the national strategic importance of the Reko Diq copper-gold project." Barrick said it was committed to developing it as a world-class mine that would "create value for the country and its people through multiple generations". The project will be operated by Barrick and owned 50% by Barrick, 25% by the Balochistan Provincial Government and 25% by Pakistani state-owned enterprises. Final contract negotiations are underway and Barrick will update the original feasibility study, a process expected to take two years. Construction of the first phase will follow that with first production of copper and gold expected in 2027/2028.
"During the negotiations the federal government and Barrick confirmed that Balochistan and its people should receive their fair share of the benefits as part of the Pakistan ownership group," Bristow said. "At Reko Diq, Balochistan's shareholding will be fully funded by the project and the Federal Government, allowing the province to reap the dividends, royalties and other benefits of its 25% ownership without having to contribute financially to the project's construction or operation. It's equally important that Balochistan and its people should see these benefits from day one. Even before construction starts, when the legalization process has been completed we will implement a range of social development programs, supported by an upfront commitment to the improvement of healthcare, education, food security and the provision of potable water in a region where the groundwater has a high saline content."
Finance Minister Ismail added that the said the development of Reko Diq is one of the largest in Pakistan. "Like Barrick, we believe that the future of mining lies in mutually beneficial partnerships between host countries and world-class mining companies. The Reko Diq agreement exemplifies this philosophy and also signals to the international community that Pakistan is open for business."
Reko Diq will be a conventional open pit and milling operation, constructed in two phases, starting with a plant that will be able to process approximately 40 million tonnes of ore per annum, a capacity that could be doubled in five years. Barrick said that the project has a "unique combination" of large scale, low strip and good grade which will insure it will be a multi-generational mine with a life of at least 40 years. During peak construction the project is expected to employ 7,500 people and once in production it will create 4,000 long-term jobs.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Located in the province of Balochistan, close to the borders of Iran and Afghanistan, Reko Diq is considered to be one of the world's largest undeveloped copper-gold deposits. However, the proposed project has been on hold since 2011 over disputes with the government regarding the licensing process. The project got back on track earlier this year when Barrick reached an out-of-court settlement, under which an US$11 billion penalty against Pakistan was waived. When fully constructed it will be capable of producing up to 200,000 tonnes of copper and 250,000 ounces of gold per annum.
After a meeting last week between Pakistan's Finance Minister, Miftah Ismail, and Barrick president and chief executive, Mark Bristow, they said that they shared a "clear vision of the national strategic importance of the Reko Diq copper-gold project." Barrick said it was committed to developing it as a world-class mine that would "create value for the country and its people through multiple generations". The project will be operated by Barrick and owned 50% by Barrick, 25% by the Balochistan Provincial Government and 25% by Pakistani state-owned enterprises. Final contract negotiations are underway and Barrick will update the original feasibility study, a process expected to take two years. Construction of the first phase will follow that with first production of copper and gold expected in 2027/2028.
"During the negotiations the federal government and Barrick confirmed that Balochistan and its people should receive their fair share of the benefits as part of the Pakistan ownership group," Bristow said. "At Reko Diq, Balochistan's shareholding will be fully funded by the project and the Federal Government, allowing the province to reap the dividends, royalties and other benefits of its 25% ownership without having to contribute financially to the project's construction or operation. It's equally important that Balochistan and its people should see these benefits from day one. Even before construction starts, when the legalization process has been completed we will implement a range of social development programs, supported by an upfront commitment to the improvement of healthcare, education, food security and the provision of potable water in a region where the groundwater has a high saline content."
Finance Minister Ismail added that the said the development of Reko Diq is one of the largest in Pakistan. "Like Barrick, we believe that the future of mining lies in mutually beneficial partnerships between host countries and world-class mining companies. The Reko Diq agreement exemplifies this philosophy and also signals to the international community that Pakistan is open for business."
Reko Diq will be a conventional open pit and milling operation, constructed in two phases, starting with a plant that will be able to process approximately 40 million tonnes of ore per annum, a capacity that could be doubled in five years. Barrick said that the project has a "unique combination" of large scale, low strip and good grade which will insure it will be a multi-generational mine with a life of at least 40 years. During peak construction the project is expected to employ 7,500 people and once in production it will create 4,000 long-term jobs.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
