Reko Diq, located in the Chagai district of Balochistan, is one of the world’s largest undeveloped copper and gold deposits. Positioned near the borders of Iran and Afghanistan, the region holds strategic and economic importance for Pakistan’s future.
Estimated Mineral Reserves in Reko Diq
Reko Diq holds:
- 42 million tons of copper ore
- 22 million ounces of gold
These deposits are close to the surface, making extraction relatively feasible and cost-effective. The size and quality of these reserves put Reko Diq among the world’s top mineral-rich areas.
Background: How It All Started
In 1993, a joint venture agreement known as CHEJVA (Chagai Hills Exploration Joint Venture Agreement) was signed between the Balochistan Development Authority (BDA) and the Australian company BHP. Later, this agreement was transferred to Tethyan Copper Company (TCC), a joint venture between Barrick Gold and Antofagasta PLC.
TCC invested over $400 million in exploration and feasibility studies.
Legal Dispute and International Arbitration
In 2011, the Balochistan government refused to grant a mining lease to TCC, citing legal and procedural concerns. As a result, TCC filed a case at the International Centre for Settlement of Investment Disputes (ICSID).
In 2019, ICSID ruled in favor of TCC, ordering Pakistan to pay:
- $5.9 billion in compensation
- $2 billion in interest
This $8 billion penalty became one of the largest in ICSID’s history and placed significant economic and reputational pressure on Pakistan.
New Agreement with Barrick Gold (2022)
To resolve the dispute and avoid enforcement of the massive penalty, Pakistan negotiated a new agreement with Barrick Gold in 2022.
Revised Shareholding Structure:
- 50% – Barrick Gold Corporation
- 25% – Government of Balochistan
- 25% – Pakistani federal entities (OGDCL, PPL, GHPL)
This structure gave Pakistan 50% ownership, along with local participation and operational control for future planning and profits.
Supreme Court Validation
On December 9, 2022, the Supreme Court of Pakistan ruled that the new Reko Diq agreement was legal, constitutional, and in the national interest.
Future Outlook: What Lies Ahead
In 2023, Barrick Gold announced its plan to make the Reko Diq mine operational by 2028, with an estimated $10 billion in investment.
This project is expected to:
- Create thousands of jobs
- Improve local infrastructure
- Contribute significantly to Pakistan’s GDP
- Reduce reliance on foreign mineral imports
Why Reko Diq Matters for Pakistan
Reko Diq is more than a mining project; it is a strategic national asset. If managed transparently and efficiently, it can transform Balochistan’s economy and contribute to national self-reliance in minerals.
Conclusion
The Reko Diq project stands at a turning point. From international legal disputes to renewed hope through a revised agreement, Pakistan now has the opportunity to unlock the true potential of its hidden mineral wealth.
