Reko Diq: Who Benefits from Balochistan’s Mineral Wealth? Reko Diq, located in Balochistan’s Chagai district near Afghanistan and Iran, is home to one of the world’s largest undeveloped mining sites, rich in copper and gold. The region, characterized by arid terrain, mountains, and low population density, faces numerous developmental challenges, including a lack of basic infrastructure and limited access to education, healthcare, and clean water. Despite these issues, the Reko Diq project, which has been in the spotlight for years, recently reached a key milestone with Barrick Gold Corporation, the project’s primary stakeholder, making significant progress toward the development of the mine.
Barrick Gold owns a 50% share in the Reko Diq copper and gold project, with the remaining shares split between the federal state-owned enterprises (25%) and the Balochistan government (25%). The project has been pivotal for the region, with Barrick claiming that 77% of Reko Diq Mining Company’s employees are from Balochistan. It has also made contributions to the local community, including providing education for 80% of children under 10, supplying clean water to hundreds of households, and investing $2.5 million in community projects.
In 2022, a crucial agreement was made between the Balochistan government and Barrick to restart the Reko Diq project, which had been stalled due to legal disputes. Under the agreement, Barrick Gold pledged a $10 billion investment and the elimination of an $11 billion fine, which would bring substantial economic benefits to the region. The project is expected to create 8,000 jobs in Balochistan and generate over $100 billion in revenue for both the federal and provincial governments.
The history of the project dates back to 1993 when the Balochistan government signed a deal with Broken Hills Properties Minerals, an Australian company. The agreement was later transferred to Tethyan Copper Company (TCC), and after exploration confirmed the economic potential of Reko Diq’s deposits, the company was acquired by a Canadian-Chilean consortium. However, TCC faced numerous legal hurdles, and in 2011, its bid for a mining license was rejected by the Balochistan government due to non-compliance with local regulations. After years of legal battles, TCC’s agreement was declared null and void by the Supreme Court, and Barrick Gold subsequently took over the project.
Barrick CEO Mark Bristow has emphasized that the Reko Diq project is unprecedented in Pakistan’s mining sector and that the company is committed to making it a success. He assured that Balochistan would retain its 25% share in the project and benefit from taxes and royalties. Barrick has also committed to involving the local workforce in the project, emphasizing the importance of investing in local talent.
However, experts remain concerned about the transparency of the contract between Barrick Gold and the Pakistani government. Economists argue that the real benefits of the project will only be realized if the revenue generated is carefully monitored and the project operates with full transparency. Concerns have also been raised about the sale of 15% of Reko Diq’s shares to Saudi Arabia for $540 million, which some experts believe is undervalued.
In addition, there are calls for Pakistan to push Barrick Gold to establish processing units within the country rather than exporting raw minerals, as well as to improve regional infrastructure, including a railway line to connect Reko Diq with Gwadar Port. These measures could help boost the region’s economic potential and ensure that the people of Balochistan see long-term benefits from the mining project.
Despite the challenges, the Reko Diq project remains one of the most significant development opportunities for Balochistan, and with careful oversight and transparency, it could contribute substantially to the province’s economic growth and prosperity.
