Following a favorable ruling from Pakistan’s Supreme Court and the passage of the necessary laws, Barrick Gold Corporation said yesterday that it has finished reconstituting the Reko Diq project.
Reko Diq is one of the biggest undeveloped copper-gold prospects in the world. Barrick owns 50% of it, three federal state-owned firms control 25%, and the Province of Balochistan owns 15% on a fully funded and 10% on a free carried basis.
The conclusion of the legal procedures, according to Barrick President and Chief Executive Mark Bristow, was a critical step in developing Reko Diq into a world-class, long-life mine that would significantly increase the company’s strategically significant copper portfolio and benefit its Pakistani stakeholders for generations to come.
According to the official press release issued by the company, Reko Diq will be a significant contributor to Pakistan’s economy and is anticipated to have a transformative effect on the underdeveloped Balochistan province.
“We are currently updating the project’s 2010 feasibility and 2011 feasibility expansion studies. This should be completed by 2024, with 2028 targeted for the first production,” Bristow said.
“With its unique combination of large scale, low strip, and a good grade, Reko Diq is expected to have a life of at least 40 years. We envisage a truck-and-shovel open pit operation with processing facilities producing a high-quality copper-gold concentrate. We expect it to be constructed in two phases with a combined process capacity of 80 million tonnes per annum.”
In addition to the economic benefits it will bring, the mine will also create jobs, support the expansion of a regional economy, and invest in development programs.
According to the official statement issued by the firm, the province’s investment in the mine would be completely funded, meaning that Balochistan will enjoy the dividends, royalties, and other benefits of its 25% ownership without having to make financial contributions to its development and management.
“Reko Diq’s ownership structure is a further manifestation of Barrick’s commitment to partnership with its host countries and communities and to sharing the value our operations create fairly with all our stakeholders,” Bristow said.
“We’re making sure that Balochistan and its people will see these benefits quickly. Starting early next year, Barrick will implement a range of social development programs prioritizing the improvement of healthcare, education, vocational training, food security, and the provision of potable water. Our investment in these is expected to amount to around $70 million over the feasibility and construction period. In addition, Reko Diq will advance royalties to the government of Balochistan of up to $50 million until commercial production starts.”
The project is anticipated to employ 7,500 people at its busiest during construction, and once production begins, it will generate about 4,000 long-term jobs.
As with other companies in the group, Barrick gives locals and nationalities of the host nation preference when hiring.
According to Bristow, Barrick already possessed the best gold assets in the sector, and the acquisition of Reko Diq would elevate its copper portfolio to a world-class level, advancing the firm closer to its objective of developing the most valuable gold and copper mining company in the world.
To read our blog on “Pakistan agrees to an agreement to escape an $11bn fine in Reko Diq case,” click here.
