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PIF close to buying Pakistan copper mine stake

By Andrew Hammond
The reported $1 billion stake in the copper-gold mine would give PIF a 25% share Creative Commons/Maria Vilaró
The reported $1 billion stake in the copper-gold mine would give PIF a 25% share
  • 25% share would cost $1bn
  • 40 years of reserves
  • Deal would be boon for Pakistan

Saudi Arabia’s Public Investment Fund is close to finalising a deal to buy a $1 billion stake in Pakistan’s Reko Diq copper-gold mine, in what would be a Saudi lifeline for the debt-ridden country, a Pakistani newspaper has reported.

Barrick Gold, the Canadian-listed company that owns a 50 percent stake in the Reko Diq mine, said last year that it would support PIF taking the Pakistan government’s 25 percent stake. The other 25 percent is owned by the province of Balochistan. 

Pakistan said in November that it had appointed an international adviser to conduct a valuation of its stake in the mine and hoped to conclude a deal in December at the earliest with Saudi Arabia. 

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A new government under prime minister Shehbaz Sharif took power in March. 

The Express Tribune, a Pakistani daily, said on 3 April that Pakistan would send a committee to Saudi Arabia within weeks to complete the deal, which would see the Pakistan government-owned Oil and Gas Development Company Ltd and Pakistan Petroleum Limited sell their shares. 

Both companies are publicly traded on the Pakistani stock exchange, but Oil and Gas has a secondary listing in London. 

“Saudi Arabia is expected to invest in the project next month,” the paper said.

PIF and the consultancy said to be involved, the UAE-based RB&A Partners, did not respond to requests for comment. 

The mine deal would be a big boon for Pakistan, which narrowly averted a sovereign default last year after a $3 billion bailout from the International Monetary Fund. 

Reko Diq is believed to have one of the world’s largest reserves of copper and gold, estimated at 5.9 billion tonnes of ore grading 0.41% copper and 41.5 million ounces of gold reserves, worth $95 billion at today’s price, and a projected mining life of at least 40 years

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