The first attempt by Barrick Gold Corp. to establish a copper mine in Pakistan was unsuccessful because the government withheld approval. The corporation is making a new, much bolder attempt ten years later.
The Toronto-based miner unveiled updated plans for the massive Reko Diq copper-gold discovery on Tuesday. This resource is located in a desert area close to the borders of Iran and Afghanistan.
According to a presentation on Barrick’s website, the conceptual design calls for the $7 billion project to be developed in two phases, each of which will have the capacity to process around 40 million metric tonnes of ore annually, with production beginning as early as 2027. The most recent concept is more than twice as expensive as the 2010 feasibility study’s estimate and doubles the annual throughput capacity.
While its Chilean partner, Antofagasta Plc, abandons the project in favour of safer and nearby jurisdictions in the Americas, Barrick is increasing its chances on Pakistan.
Barrick cites lucrative returns as one of its arguments. Annual production of around 200,000 tonnes of copper would begin just as the world faces a shortage of a material necessary for the shift to clean energy because of how much copper is needed in renewable energy and electric vehicles.
In addition, mine construction is becoming more difficult and expensive all around the world because to the growth in political risk, even in historically safer countries like Chile and Peru.
Pakistan consequently appears to be less dangerous just as a new centrist prime minister takes office.
As a result of an agreement that Barrick had to use in Papua New Guinea and which offers host countries a greater direct interest in the success of projects, Pakistan is now a 50% partner in Reko Diq. Following the agreement with Pakistan last month, Barrick intends to complete an update of the Reko Diq feasibility assessment. The two-phase strategy used by Barrick in the conceptual design allows the corporation to hasten first production while lowering risk. The initial crush, milling, and flotation circuit would be covered by a $4 billion first phase, with output expected to begin in 2027–2028.
A parallel circuit that would start operating five or more years after phase one begins would be included in a $3 billion second phase.