The International Finance Corporation (IFC), the private investment arm of the World Bank, has pledged $300 million in debt financing for the Reko Diq copper-gold mining project, according to an IFC disclosure released on Wednesday.
Barrick Gold is leading the Reko Diq project to secure over $2 billion in financing from international lenders, with plans to finalize term sheets by early Q3 2025, according to project director Tim Cribb. The funding will help develop one of the world’s largest underdeveloped copper-gold deposits, which could generate $70 billion in free cash flow and $90 billion in operating cash flow.
Barrick Gold, the federal government, and the Balochistan government will jointly operate the project, with production expected to begin in phase one by 2028.. Discussions about its financing are ongoing with various lenders, including $650 million in contributions sought from the IFC and International Development Association.
Additionally, negotiations are underway with the US Export-Import Bank for $500 million to $1 billion in financing, and $500 million from development finance institutions, such as the Asian Development Bank, Export Development Canada, and the Japan Bank for International Cooperation.
Cribb noted that term sheets could be finalized by late Q2 or early Q3 this year. He also highlighted that they are progressing with railway infrastructure financing, estimated to cost $500-$800 million, allocating $350 million for the initial phase.
The recently conducted feasibility study has expanded the scope of the Reko Diq project. The company now projects phase one throughput to increase to 45 million tonnes per annum (up from 40 million), while it has adjusted phase two throughput to 90 million tonnes per annum (up from 80 million). Increased mining has reduced the mine’s projected lifespan to 37 years, down from 42 years. Still, unaccounted-for mineral deposits could potentially extend this lifespan to an impressive 80 years.
The initial cost of phase one has also increased, climbing from $4 billion to $5.6 billion to reflect the expanded production scale.
The World Bank has announced plans to invest $2 billion annually in Pakistan’s infrastructure over the next decade. Furthermore, lenders are working on securing offtake agreements with potential clients from key industrial nations, including Japan, Korea, Sweden, and Germany, which are keen to secure steady copper supplies for their industries.
