Reko Diq Mining Project Sees Renewed Global Interest as Barrick Slows Development
The Reko Diq mining project has once again moved into the global spotlight as the European Investment Bank (EIB) expressed strong interest in investing in Pakistan’s multibillion-dollar copper and gold venture. However, this renewed attention comes with clear conditions, including access to critical mineral supplies, while Pakistani officials push back against exaggerated claims about the country’s mineral wealth. EIB Signals Investment Interest in Reko Diq During the EU-Pakistan Business Forum, EIB representative Marco Arena highlighted the bank’s willingness to finance infrastructure linked to the Reko Diq mining project. He stressed that Europe seeks reliable access to critical minerals to support its green and digital transition. Arena clarified that the European Union does not expect exclusive rights over resources. However, he emphasized that a stable supply connection with European markets remains essential. According to him, such partnerships would strengthen Europe’s competitiveness in emerging technologies. The EIB has already re-engaged with Pakistan after a long pause. Recently, it finalized agreements worth €160 million to support water and housing sectors. This renewed cooperation signals growing European confidence in Pakistan’s economic potential, particularly in the mining sector. Pakistan Rejects $6 Trillion Mineral Claim At the same forum, Dr. Nawaz Ahmed Virk, Director General of Minerals at the Ministry of Energy, addressed widely circulated claims that Pakistan holds $6 trillion worth of mineral reserves. He categorically rejected the figure, calling it “highly exaggerated” and unsupported by scientific exploration. Virk acknowledged that Pakistan possesses vast mineral resources, especially in regions like Balochistan. However, he stressed that realistic valuations require comprehensive geological studies. His remarks signal a shift toward more evidence-based policymaking in the resource sector. Tax Issues and Investor Incentives Under Review The government continues to adjust policies to attract foreign investors to the Reko Diq mining project. Currently, Pakistan has granted tax exemptions on project income to enhance its appeal. Still, contractors have raised concerns about sales tax and withholding tax during the development phase. Virk confirmed that the Ministry of Energy is working closely with the Finance Division to resolve these issues. Officials are considering deferring such taxes until the project reaches production stage. This move could ease financial pressure on investors and accelerate development timelines. Security Risks Slow Down Project Progress Despite strong international interest, the Reko Diq mining project faces serious security challenges. Canadian mining giant Barrick Gold, which holds a 50 percent stake, recently slowed down development activities. The company cited escalating security risks in Pakistan and the broader region as the primary reason. In its February 2026 statement, Barrick announced a comprehensive review of the project. The review will continue until mid-2027, allowing the company to reassess security conditions, financing needs, and overall project scope. Although development has slowed, Barrick confirmed that the project remains under active management. However, reduced capital spending and potential cost increases could impact timelines. Massive Investment and Future Outlook The Reko Diq mining project ranks among the world’s largest undeveloped copper-gold reserves. Phase 1 alone carries an estimated cost between $5.6 billion and $6 billion. Meanwhile, Phase 2 could require an additional $3.3 billion to $3.6 billion. Initial production was expected by the end of 2028. However, delays linked to security concerns and financial adjustments may push timelines further. Ownership of the project reflects a strategic partnership. Barrick Gold controls 50 percent, while Pakistani state-owned enterprises and the government of Balochistan share the remaining stake. Policy Stability Key to Unlocking Potential Experts believe that policy consistency, regulatory transparency, and security improvements will determine the project’s success. Arena noted that engineering challenges are often easier to solve than regulatory uncertainty. He stressed that predictable policies and enforceable contracts are critical for large-scale mining investments.