Major Boost for Reko Diq Project with ADB’s $410M Support
ISLAMABAD – In a strategic move set to reshape Pakistan’s mining sector, the Asian Development Bank (ADB) has approved a $410 million financing package for the development of the Reko Diq copper and gold mine in Balochistan. Operated by Barrick Gold Corporation, this mine is one of the world’s largest untapped copper-gold deposits and is now poised to unlock its full economic potential.
The ADB financing package, according to sources familiar with the deal, comprises $300 million in direct loans to Barrick Gold and a $110 million financing guarantee to the Government of Pakistan. This development is expected to accelerate construction timelines and attract additional foreign investment in Pakistan’s burgeoning mineral sector.
Project Overview: Reko Diq’s Strategic and Economic Importance
Located in Pakistan’s southwestern province of Balochistan, the Reko Diq project is a $6.6 billion venture jointly owned by Barrick (50%) and the federal and Balochistan governments (50%). The mine is projected to start production by 2028, delivering an estimated 200,000 metric tons of copper annually in its initial phase and eventually doubling output to 400,000 tons.
Barrick Gold projects the mine could generate around $70 billion in free cash flow over its anticipated 37-year lifespan, with potential extensions based on exploration and technological upgrades.
Foreign Interest and Financing Momentum Builds
The ADB’s commitment adds momentum to an already strong international financing push. The International Finance Corporation (IFC), a World Bank Group member, previously pledged $700 million for the project. Discussions are also ongoing with global institutions including:
| Financial Institution | Country | Status |
|---|---|---|
| U.S. Export-Import Bank | United States | Negotiation Phase |
| Export Development Canada | Canada | Negotiation Phase |
| JBIC (Japan Bank for Int’l Cooperation) | Japan | Negotiation Phase |
According to project director Tim Cribb, agreements with these institutions are expected within this quarter.
Mining Sector as a Gateway to Rare Earth Investments
Pakistan aims to use the Reko Diq development as a stepping stone to boost foreign interest in its rare earth elements and mineral resources, an area that has attracted attention from previous U.S. administrations. Islamabad has signaled openness to future concessions to encourage multinational investment, particularly from the United States and allies.
This strategic alignment could position Pakistan as a key player in the global rare earth supply chain at a time when countries are seeking alternatives to China’s dominance in the sector.
Local Contributions from Pakistani Energy Giants
In addition to international support, local firms are significantly invested. Both the Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL) have recently raised their respective stakes to $715 million each, solidifying local commitment to the project’s success.
Barrick’s Commitment and Equipment Investment
In a parallel development, Barrick Gold has inked a $440 million equipment deal with Japanese firm Komatsu to ensure the timely delivery of heavy machinery essential for mining operations. This agreement demonstrates Barrick’s long-term commitment to efficient and sustainable mining practices at Reko Diq.
Overcoming Legal Hurdles
The Reko Diq project had been delayed for over a decade due to a complex legal dispute, which was resolved in 2022 through international arbitration and a comprehensive settlement agreement. Since then, development has resumed in full swing, with 2025 earmarked for the completion of infrastructure and 2028 as the start of production.
Economic and Geopolitical Significance
The scale and ambition of the Reko Diq project position it not just as an economic milestone, but as a geopolitical asset. With major multilateral and bilateral players involved, the mine could serve as a blueprint for future infrastructure and resource investments in Pakistan.
The project’s success will likely influence investor sentiment, regulatory reform, and Pakistan’s standing in regional economic corridors, including initiatives under CPEC (China–Pakistan Economic Corridor).
Suggested Internal Link:
Pakistan’s Strategic Minerals and CPEC-II Expansion
Suggested External Link:
Asian Development Bank Official Website
“Pakistan’s mining sector has received a massive boost thanks to the ADB’s $410 million support for Reko Diq. Read more here.”
Conclusion
The Asian Development Bank’s $410 million investment in Pakistan’s Reko Diq project is a transformative step that reflects growing global confidence in the country’s natural resource sector. With production expected to begin by 2028 and strong international backing, the mine could become a major pillar of Pakistan’s economic future.
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