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Hilal English

Reko Diq : A Billion-Dollar Mining Odyssey

December 2023

Beyond being a mere mining endeavor, Reko Diq signifies a journey towards economic revival for Pakistan, with the potential to generate jobs and uplift communities for the long term. With all eyes on this project, its successful execution could serve as a model for an inclusive development of resources.



Pakistan is home to a dynamic mining project located near the town of Reko Diq in the Chagai District, approximately 561 km northwest of Quetta, the main city in Balochistan, close to the borders of Iran and Afghanistan. This multibillion-dollar project is poised to significantly transform Pakistan's economy and the future of the Balochistan province. The global scale of the project is evident in the vast copper and gold reserves at Reko Diq, estimated at 5.9 billion tons of ore grading 0.41 percent copper, with gold reserves totaling 41.5 million ounces (oz). The term 'Reko Diq' entered common usage in 1978, signifying a sandy hill in the local language, following a geological survey that revealed extensive gold and copper reserves. These remarkable reserves have the potential to revolutionize Pakistan's economy. However, extracting these minerals is a challenging process, as separating gold from other substances such as copper, sand, stones, and various metals is both complex and expensive.


In 1978, the new term "Reko Diq," a local language for a sandy hill, became common. This happened after a geological survey revealed extensive gold and copper reserves here. Imagine about a million tons of gold and copper! These incredible reserves could truly revolutionize Pakistan's economy. 


The Reko Diq project began in 1993 with the Chagai Hills Exploration Joint Venture Agreement (CHEJVA) between the Pakistan government and the Australian company, Broken Hills Proprietary Minerals (BHPM). Afterwards, Tethyan Copper Company (TCC), a joint venture between Antofagasta PLC and Barrick Gold, officially launched the project in 2007. With the Reko Diq project evolving through various business agreements, and the Pakistani government making concessions for expanding the mining area, TCC submitted its first report to the Balochistan government in 2008.
The signing of the Reko Diq agreement is a major step forward in Pakistan's pursuit to utilize its mineral resources for economic growth. The resolution of legal disputes and the resumption of operations are promising signs for the success of the mining project.
In a significant breakthrough, Barrick Gold, a key player in the global mining industry, has forged an unprecedented deal with both the federal and provincial governments of Balochistan to revive the stagnant Reko Diq gold and copper mine.
According to the latest development, the Special Investment Facilitation Council (SIFC) is readying itself for business talks. Key players in these talks include Barrick Gold, Pakistani government and Saudi Arabia. To figure out the share price for the Reko Diq copper and gold mine, Pakistan called in esteemed international consultants. The prices for shares in a major mining project have been worked out by global appraisers, keeping dealings clear and open. Guarding Pakistan's business interests are top priorities in these talks. As per the expert consultant's advice, a benchmark value has been established for individual shares in order to maintain transparency in the upcoming deal. While it is still premature to discuss the specifics of the transaction model as various parties are advocating for their own preferred versions, Pakistan is committed to safeguarding their commercial interests. Barrick Gold have expressed willingness to accept investments from Saudi Arabia through the government of Pakistan's shares. Both sides are expected to negotiate and make adjustments to their stakes in order to bring in Saudi Arabia as a partner and avoid anyone being in the minority.
The Reko Diq project has garnered widespread interest, drawing the attention of global players such as Saudi Arabia who are actively seeking to tap into its abundant mineral reserves. While negotiations are ongoing and the proposed transaction model is still under debate, both parties are determined to achieve a fair and transparent agreement. Plans are underway to commence production in 2028, with the current ownership split of 50 percent by Barrick Gold Corporation.  At the same time, Antofagasta of Chile had exited the project after selling its stake in exchange for USD 900 million to three state-owned enterprises (SOEs) of the federal government naming Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Private Limited,  which collectively owns 25 percent stake and remaining 25 percent is held by Balochistan, out of which 15 percent is held by the province of Balochistan for a fully funded Special Purpose Vehicle and 10 percent by the province of Balochistan on a free carried interest basis. The ongoing updates of feasibility studies stand as a testament to Barrick Gold's unwavering dedication towards ensuring the project's sustainability and eventual success. The economic impact of this venture is poised to be revolutionary, especially for the development of Balochistan. 
Reko Diq, an open pit mine with an estimated lifespan of over 40 years, is set to make a  significant contribution to Pakistan's economy. The construction phase alone is projected to provide employment opportunities to around 7,500 individuals, with an additional 4,000 long-term jobs being created during production. This commitment perfectly aligns with Barrick Gold's global strategy of prioritizing the empowerment and prosperity of local communities. 


Reko Diq, an open pit mine with an estimated lifespan of over 40 years, is set to make a  significant contribution to Pakistan's economy. The construction phase alone is projected to provide employment opportunities to around 7,500 individuals, with an additional 4,000 long-term jobs being created during production. 


Construction will occur in two stages, resulting in a combined process capacity of 80 million tons per annum. The Reko Diq asset holds a staggering value of almost USD one trillion. Geological Survey of Pakistan’s (GSP's) discovery of this valuable mineral deposit in Balochistan is a stroke of luck for Pakistan. The country should recognize its fortunate position and take measures to ensure it receives dividends, royalties, and other benefits without having to financially contribute to the construction and operation of the project. This forward-thinking approach demonstrates a vision where mining projects do not only boost economic growth but also promote the overall development of surrounding communities.
The Reko Diq mining project stands as a pivotal opportunity, uniting global investors such as Canada's Barrick Gold Corporation, Saudi Arabia, and  Pakistan’s government in a collaborative effort to unlock the vast potential of the region's mineral resources. With the ongoing commercial negotiations and progress being made, there is a steadfast commitment to transparency, fair distribution of ownership, and sustainable growth. Beyond being a mere mining endeavor, Reko Diq signifies a journey towards economic revival for Pakistan, with the potential to generate jobs and uplift communities for the long term. With all eyes on this project, its successful execution could serve as a model for an inclusive development of resources.


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