Pakistan moves closer to Reko Diq revival with $3.5b funding deal

Agreement signed by federal government and Barrick Gold Corporation, final approval from lenders’ boards pending

Pakistan has finalised a $3.5 billion financing agreement with six major international financial institutions for the development of the historic Reko Diq mining project in Balochistan — a milestone for one of the country’s most significant mineral ventures.

According to official sources, the financing package includes commitments from leading global lenders such as the US EXIM Bank, Asian Development Bank, International Financial Institutions, International Development Association, and the European Bank.

The agreement was signed by the project sponsors, the federal government and Barrick Gold Corporation, while final approval from the lenders’ boards remains pending. Once cleared, the disbursement process is expected to begin within 45 to 90 days, subject to fulfillment of the agreed conditions.

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Under the terms of the deal, lenders will be granted a grace period of four to five years, with loan repayments spread over a 12-year schedule. The financing will carry a single-digit interest rate, offering Pakistan a relatively favourable borrowing framework.

Officials said that if all prerequisites are completed on time, the first tranche of funds could be released within two months.

Key stakeholders in the project include Barrick Gold Corporation, the Balochistan government, Oil and Gas Development Company Limited, and Pakistan Petroleum Limited.

Under the agreed equity structure, Barrick Gold will retain a 55 per cent share, while OGDCL and PPL will jointly hold 27.7 per cent. Balochistan will maintain a 16.6 per cent equity stake.

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With an estimated total cost of around $7.7 billion, the Reko Diq project is expected to commence production by the end of 2028.

According to official estimates, the project could generate approximately $53 billion in total revenue over its lifetime. Balochistan is projected to receive $11 billion in fiscal revenue, $6 billion as its provincial share, and $9 billion through equity held by Balochistan Mineral Resources Limited.

The federal government is expected to earn around $11 billion in fiscal revenues, while Pakistan Minerals Private Limited will benefit from roughly $15 billion in equity inflows.