Saudia is in negotiations with Canadian mining company Barrick Gold to invest in its Reko Diq copper mine in Pakistan. The Saudis hope to introduce a partner with strong political influence to the cash-strapped South Asian economy.
The Kingdom of Saudi Arabia is trying to wean itself off of its reliance on oil by gaining a foothold in the international mining industry and gaining access to critical minerals. The Canadian company is trying to alleviate finance constraints, and the Saudi government is ready to spend heavily.
Saudia is reportedly in talks with Barrick Gold
Public Investment Fund of Saudia is reportedly in talks with Barrick Gold about the latter’s Reko Diq copper mining project in Pakistan, a mostly untapped region for the global mining industry. Barrick’s financial worries would be much diminished, and Barrick would have a partner with significant political power in Pakistan if the Saudis joined.
However, other heavy-duty miners looking for comparable agreements around the world may find it challenging to compete with Saudi Arabia’s huge riches.
Chinese companies have been outbidding their international counterparts for years on end when it comes to the purchase of mines. Chinese state-owned metal and mining giants offer prices that Western companies can’t compete with. It’s becoming increasingly possible that Saudi Arabia will follow suit, undercutting the established participants in the business by bidding higher.
The investment climate for mining firms seeking finance has changed drastically due to the recent restriction on Chinese investment in precious metals corporations by the governments of the United States and Canada. As a result, countries in the Middle East like Saudi Arabia are looking for newcomers to fill the hole; Pakistan is one possible candidate.
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