ISLAMABAD, Aug 22 (APP):The Asian Development Bank (ADB) has approved a financing package for Pakistan’s Reko Diq copper-gold mine, aiming to meet rising global demand for critical minerals while driving economic transformation and poverty reduction in the country.
“Reko Diq will help the critical minerals supply chain, while advancing the clean energy transition and driving digital innovation across the region and beyond,” said ADB President Masato Kanda, according to ADB press release received here Friday.
“ADB’s support is also a game-changer for Pakistan, creating quality jobs and underpinning the nation’s transition toward a more resilient and diversified economy,” Kanda said.
ADB is one of several agencies funding the first phase of Reko Diq, with an innovative financing package that will help unlock greater private capital by derisking this investment. ADB’s contribution consists of 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. Financing for the project will be the largest foreign direct investment in Pakistan’s history.
When fully complete, Reko Diq is expected to be the world’s fifth-largest copper mine. In the first phase, the mine will produce on average 800,000 tons of copper concentrate per annum and play a key role in addressing the projected global copper shortfall. Copper, a critical mineral for energy transition and digital transformation, is essential to the global production of renewable energy technologies, electric vehicles, batteries, smartphones, and data centers.
Located in the Chagai district of Balochistan—Pakistan’s least developed province—the Reko Diq copper-gold mine is expected to have a significant impact on the economy. It will create thousands of jobs, stimulate regional economic growth, and support social development programs in healthcare and education, including targeted initiatives for communities, especially women.
RDMC is a joint venture designed to ensure equitable benefit-sharing. Barrick Mining Corporation, which will build and operate the mine, owns 50% of RDMC; the Government of Balochistan (through Balochistan Mineral Reserve Limited) owns 25%; and three federal state-owned enterprises together own 25%.
Work at the site, which involves building and operating the open-pit mine and processing plant, began this year. The mine is being developed with robust environmental, social, and governance standards. It will start producing copper concentrate in late 2028 and is expected to operate for at least 37 years.
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 press release added.
All projects will be subject to ADB’s strict environmental and social requirements, due diligence, and rigorous impact assessments.
The approval by ADB’s Board of Directors authorizes ADB to proceed with finalizing the loan documentation and other requirements before the financing can be formally committed through signed agreements at a later date.
Since Pakistan became a founding member of ADB in 1966, the bank has committed more than $43 billion to promote inclusive growth and improve infrastructure, energy, transport, and social services.