Pakistan: Production at the world's largest untapped copper, gold mine to start in 2028

The Asian Development Bank approved a $410 million package for developing Pakistan's Reko Diq copper and gold mine, as the country's rare earth deposits draw foreign interest and human rights concerns.

The potentially hugely lucrative open-pit project in Pakistan's Balochistan province seeks to develop one of the world's largest untapped copper and gold deposits, with production expected to start in 2028.

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The ADB package includes $300 million in loans to Canadian firm Barrick and a $110 million credit guarantee for the local government.

When completed, Reko Diq is projected to be the world's fifth-largest copper mine, a metal critical for wiring, motors and renewable energy technology.

"Reko Diq will help the critical minerals supply chain, while advancing the clean energy transition and driving digital innovation," ADB President Masato Kanda said in a statement. 

Kanda called the package "a game-changer for Pakistan... underpinning the nation's transition toward a more resilient and diversified economy."

Barrick defended its mining practices in a statement emailed to AFP.

"Barrick is committed to responsible mining and sharing the benefits of its operations with local stakeholder and partners, based on open and transparent engagement and the highest environmental and social safeguards," it said.

At current market price of $3,016 per ounce of gold and $9,815 per tonne of copper, the total yield works out to be over $60 billion, including $54 billion of gold and $6 billion of copper, Dawn reported.

Under the updated feasibility study, Phase 1 is planned to process 45 million tonnes of mill feed annually (Mtpa) from 2028. Previously, it was estimated to be close to 40 million tonnes. By 2034, Phase 2 is planned to double the processing capacity to 90Mtpa, the OGDCL said.

The updated feasibility study outlines a mine life of 37 years, divided into two phases. Phase 1 of the project entails an estimated capital outlay of $5.6 billion (exclusive of financing costs and inflation) and is expected to commence operations in 2028.

A limited-recourse project financing facility of up to $3 billion is being pursued, with the remainder to be funded through shareholder contributions, OGDCL said.

Pakistan's military chief has recently sought to play up the country's potential as a minerals and rare earths hub, touting them while negotiating trade tariffs with US President Donald Trump's administration.

Pakistani officials have long promoted the Reko Diq project as a cornerstone of the country's economic revival strategy.

Despite its potential, the mine has advanced slowly over the years, waylaid by legal disputes, bureaucratic complications and divisions between federal and provincial authorities. — With inputs from Dawn