Saudi Arabian mining fund Manara Minerals is set to buy a 10%-20% in the Reko Diq copper and gold project in Pakistan for proceeds of about $500 million to $1 billion, the Financial Times reported on Tuesday.
Manara Minerals would buy the equity stake from the government of Pakistan in the project, which is being co-developed by Barrick Gold (NYSE: GOLD) (TSX: ABX), the FT said, citing sources.
Barrick Gold said on Monday that Reko Diq is projected to generate approximately $74 billion in free cash flow over the next 37 years, based on consensus long-term prices.
Speaking to local media, chief executive Mark Bristow said an initial estimated capital expenditure of $5.5 billion will be allocated to develop the first phase of the mine. During this phase, Reko Diq, in which by the governments of Pakistan and the province of Balochistan have a combined 50% stake, is expected to produce 200,000 tonnes of copper concentrate and 250,000 ounces of gold annually.
In an interview with Pakistani digital media outlet Dawn News, Bristow confirmed that the starter mine is scheduled for completion by 2029. A second phase, requiring an additional investment of $3.5 billion, is projected to double production, he added.
Barrick has long maintained that Reko Diq is one of the world’s largest undeveloped copper-gold prospects. It also boasts a high copper grade of 0.53%, meaning that for every tonne of ore mined, about five kilograms of copper can be extracted. Once the expansion is complete, the mine is expected to process over 90 million tonnes of ore annually.
Source: MINING.COM – Read More
