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PIF-backed Manara Minerals has submitted an offer to acquire a 15% stake in Barrick Gold’s Reko Diq copper and gold mining project in Pakistan, Express Tribune reports, citing unnamed Pakistani officials. The offer includes both a cash purchase of shares and a grant for infrastructure development around the mining area. Information about the grant size wasn’t disclosed. The feasibility study would be completed by December of this year, while commercial production is slated for 2028, the news outlet reports, citing Barrick Gold.
Background: Manara — a JV between the Public Investment Fund and mining giant Ma’aden — was said to be close to a USD 1 bn investment in the mining project. The copper-gold mine is 50% owned by Barrick Gold and is expected to start production in 2028. The move comes as Pakistan looks to reel in some USD 5 bn for investments in mining and agriculture from Saudi Arabia by 2025, Express Tribune says.
About Reko Diq: The project is 50% owned by Barrick Gold, 25% by Pakistan’s federal government, and 25% by Pakistan’s Balochistan province. Currently in the feasibility phase, production is expected by 2028. The estimated total project cost is between USD 6 bn and USD 6.5 bn, requiring USD 3 bn to USD 3.5 bn in debt financing.
WHAT’S NEXT- Pakistan has formed a negotiation committee to review the offer and recommend a final price to the federal cabinet. If accepted, Pakistan’s federal government will sell a 15% stake in the upcoming mining project. The federal government currently holds 25%. Infrastructure works tied to the acquisition will see Riyadh provide a grant to build the Mashkhel-Panjoor road, boosting connectivity to the mining area.
This is all happening as Riyadh and Islamabad are warming up: Foreign Minister Prince Faisal bin Farhan was in the Pakistani capital in April, a week after Pakistan’s prime minister discussed a USD 5 bn investment package during a meeting in Makkah with Crown Prince Mohammed bin Salman. Saudi Arabia has been among the key backers of crisis-hit Pakistan, extending the term of USD 3 bn in deposits at the State Bank of Pakistan for an additional year to December of this year. This is in addition to USD 2 bn in financial assistance last year to shore up Pakistan’s finances. Saudi Aramco also acquired a 40% stake in oil retail company Gas & Oil Pakistan in June.
