REKO-DIQ PROJECT: A BEACON OF HOPE FOR BALOCHISTAN
04 April 2024
A delegation from Barrick Gold Company, headed by CEO Mark Bristow, had a meeting with Prime Minister Muhammad Shahbaz Sharif on 22 March 2024. It is anticipated that the feasibility of the Reko Diq project in Balochistan is expected to be finalized by the end of this year. According to the CEO, their goal is to start production in 2028. There are expectations of a significant investment of 10 billion dollars in this project. This project is expected to yield approximately 200,000 tonnes of copper and 250,000 ounces of gold a year.
During peak construction, the project is expected to employ around 7,500 people, with an additional 4,000 long-term jobs created after production begins. The province of Balochistan and the northwestern region of the country are estimated to possess mineral resources with an estimated value of $6 trillion. According to Bloomberg, Barrick Gold Corp. CEO Mark Bristow has expressed that multinational mining companies are showing a growing interest in developing the Reko Diq gold and copper mine in southern Pakistan, which is valued at $7 billion.
This demonstrates a positive indication of renewed investor confidence in Pakistan, including Barrick Gold. This newfound confidence is credited to the creation of the Special Investment Facilitation Council (SIFC), which has opened doors for these successful partnerships.
The government is implementing various strategies to enhance investment facilitation, particularly in the domains of road infrastructure and communication networks. In Balochistan, strategic considerations will be given to the development of communication infrastructure, with a particular focus on railway lines from Reko-Diq to Gwadar port. The Reqo Dik to Gwadar rail project would provide easy and quick access while also reducing distance compared to the Bin Qasim port. The new railway line would benefit the mineral-rich district of Chaghai by promoting the mining industry.
Barrick Gold demonstrates an inclination towards increasing its investments in several mining resources such as Saindak located in the district of Chagi. Furthermore, it is worth considering the potential for a cooperative endeavor between the government and Barrick Gold to establish a technical institution inside the Chagai district of the province.
Significantly, there is a prioritization of individuals who are local and have a domicile in Balochistan for employment in the Reko Diq project. Consequently, the Reko Diq mining project plays a crucial role in the economic advancement of Balochistan. Three educational institutions have been established near Reko Diq as part of the Corporate Social Responsibility initiatives.
This is a one-of-a-kind opportunity for significant foreign investment in the Balochistan province, and it will provide massive direct and indirect advantages not only to the province but also to Pakistan for decades. In addition to local employment and skill development, infrastructure renovations, and enhanced medical and education systems, Reko Diq will serve as a springboard for more exploration of minerals.
Saudi Arabia has reportedly shown interest in obtaining a partial stake in Reko Diq due to the highly profitable potential of the mining site. Saudi Arabia aims to secure investment in the mining sector by 2030 to leverage its abundant mineral resources, Pakistan is a promising location for Saudi Arabia to invest in minerals.
American firms are contemplating investments in Balochistan, Pakistan, owing to the region’s abundant reserves of minerals and mining. The facilitation of foreign investments in Pakistan will enable the government to enhance its investments in national stability, hence yielding advantageous outcomes for the country. The aforementioned objective can be achieved through the cultivation of stronger interpersonal connections and the effective operationalization of Bostan, Gidani, and Hub economic zones that offer similar benefits to foreign firms as those provided to foreign investors in Pakistan
The mineral ventures will heavily rely on foreign investors, whose capital will be safeguarded by the Special Investment Facilitation Council. Pakistan has implemented an investor-friendly framework that eliminates superfluous intricacies and offers advantageous circumstances. The investments and involvement of Barrick Gold and other multinational corporations in Pakistan served as an indication of the resurgence of investor trust in the country.
Reko Diq represents a significant untapped copper-gold reserve of considerable magnitude on a global scale. It is anticipated that Reko Diq will exert a significant impact on the economy of Pakistan. The initiative will not only yield economic benefits but also greatly enhance Baluchistan’s growth prospects through job creation, local economic stimulation, and increased investments in healthcare, education, vocational training, food security, and clean water supplies. The complete financing of the province’s ownership in the mine will enable Baluchistan to benefit from the dividends, royalties, and other perks associated with its 25 percent ownership.
The implementation of the Reko Diq project has the potential to significantly impact the development of Balochistan and the surrounding region. Providing adequate economic benefits to the indigenous population or investing in local infrastructure, health care, and education will result in the progress and prosperity of the people.
Pakistan has garnered attention from investors seeking opportunities in the mineral sector due to its geological potential, competitive policies, favorable fiscal and regulatory frameworks, and cost-effective workforce. It is anticipated that the natural resources of Pakistan will exert a more substantial influence, thereby augmenting their contribution to the GDP to a level above 5%, as opposed to the present figure of less than 1%. By implementing prudent governance and a strategic vision Pakistan can use its mineral resources as a driving force for long-term prosperity and advancement.
