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Economic development

Asian Development Bank Approves Financing Package for Reko Diq Copper-Gold Mine in Pakistan

Strategic Insights

— 2 min read

The Asian Development Bank (ADB) has approved a significant financing package for the Reko Diq copper-gold mine in Pakistan, a project expected to unlock transformative economic development and poverty reduction in the nation. The project aims to meet rising global demand for critical minerals and will play a key role in addressing the projected global copper shortfall. Reko Diq is expected to become the world's fifth largest copper mine, producing on average 800,000 tons of copper concentrate per annum, and create thousands of jobs, stimulate regional economic growth, and support social development programs.

Key Takeaways:

  • The Reko Diq copper-gold mine in Pakistan will be the largest foreign direct investment in the nation's history, with a financing package approved by the Asian Development Bank (ADB) worth up to $410 million.
  • The project aims to unlock transformative economic development and poverty reduction in Pakistan, while meeting rising global demand for critical minerals.
  • Reko Diq is expected to become the world's fifth largest copper mine, producing on average 800,000 tons of copper concentrate per annum and playing a key role in addressing the projected global copper shortfall.
  • The mine is expected to create thousands of jobs, stimulate regional economic growth, and support social development programs in healthcare and education, including targeted initiatives for communities, especially women.
  • Reko Diq is the first mining project supported by ADB under its new Critical Minerals-to-Manufacturing Value Chains approach, designed to help Asia and the Pacific capitalize on rising demand for materials essential to clean energy and digital technologies.
  • The project will be developed with robust environmental, social, and governance standards, and will be subject to ADB's strict environmental and social requirements, due diligence, and rigorous impact assessments.
  • ADB's contribution includes up to $300 million in senior loans to the Reko Diq Mining Company Private Limited (RDMC), which owns the mine, and a $110 million partial credit guarantee to cover the equity component of the Government of Balochistan.
  • RDMC is a joint venture designed to ensure equitable benefit-sharing, with Barrick Mining Corporation owning 50%, the Government of Balochistan owning 25%, and three federal state-owned enterprises together owning 25%.
  • Work at the site began this year, and the mine is expected to start producing copper concentrate in late 2028 and operate for at least 37 years.

Statistics:

  • Total financing package approved by ADB: up to $410 million
  • ADB's contribution: up to $300 million in senior loans to the Reko Diq Mining Company Private Limited (RDMC), and a $110 million partial credit guarantee
  • Average annual copper concentrate production: 800,000 tons
  • Projected global copper shortfall: address a significant portion of the shortage
  • Number of jobs created: thousands
  • Regional economic growth: significant stimulation expected
  • Social development programs: healthcare and education initiatives, including targeted programs for communities, especially women
  • Project duration: at least 37 years
  • Expected start of copper concentrate production: late 2028

Sources:

  • Asian Development Bank.

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