Saudi Arabia targets stake in Pakistan’s $6.5bn mining project

Reuters/Ivan Alvarado

Saudi Arabia plans to acquire a 15 percent stake in the Reko Diq mining project in Pakistan, according to a media report.

The stake will be purchased through Manara Minerals, a joint venture between Saudi Arabian Mining Co (Maaden) and the sovereign Public Investment Fund (PIF), The Express Tribune, a Karachi-based news outlet, reported.

The project’s estimated cost is between $6 billion and $6.5 billion, with $3-$3.5 billion required in debt financing. 

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Pakistan has set up a negotiation committee to review the Saudi offer and recommend the final negotiated price to government, the unnamed government officials told the newspaper.

The proposal is the first under Pakistan’s special investment facilitation council, a single window that facilitates overseas investments and fast-tracks project development.

Pakistan’s federal government will sell 15 percent from its 25 percent holding in the Reko Diq mining project to Riyadh, the report said.

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Canada’s Barrick Gold holds a 50 percent stake and the remaining 25 percent is held by the government of Balochistan.

Additionally, Saudi Arabia will invest in developing infrastructure around the mining area. Talks have started with the Saudi Fund for Development to finalise the road scheme near the mining area, the newspaper said.

The first production from the mining project is expected by 2028.

Local media in March reported that investors from the UAE, Qatar and Turkey had shown interest in Pakistan’s national airline and airports as the country accelerates its privatisation programme.