Saudi Arabia has shown interest in acquiring government stakes in Reko Diq gold and copper mine, an official said on Tuesday, in what would be a major deal for the crisis-ridden $350 billion economy.
Barrick Gold Corp, which owns a 50 per cent stake in the mine, considers the mine one of the world’s largest underdeveloped copper-gold areas.
Pakistan narrowly averted sovereign default earlier this year after a last-gasp $3bn bailout from the International Monetary Fund (IMF), but the deal rests on bringing in foreign direct investment to shore up critically low foreign exchange reserves.
Islamabad has appointed an international adviser to do a valuation of its stake in the mine and expects this to be completed before Dec 25, after which talks will begin with Riyadh, Jahanzeb Khan, the prime minister’s adviser on special investments, told journalists.
Alongside Barrick Gold, the remaining 50pc of the mine is held by the Centre and the Balochistan government.
Khan did not identify the adviser but media outlet Arab News reported earlier this month that United Arab Emirates-based consulting firm RB&A Partners has been hired.
The firm declined to comment in an emailed response to a Reuters query.
Pakistan has previously said Barrick would invest $10bn in the project. Barrick in August said it was open to bringing in Saudi Arabia as one of its partners in the mine.
The Saudi Arabian government did not immediately respond to a request for comment.
Khan said Saudi Arabia and other traditional Middle Eastern allies could potentially line up around $70bn in investments in various sectors.
Khan said that Pakistan was keen on having Saudi Arabia on board, but stressed that Islamabad was “not in a rush” and did not want to have “distress sales” for any of its assets and would protect its national interests.
He said Pakistan had set up the Special Investment Facilitation Council (SIFC) in June to help make investing faster and easier with a focus on sectors including agriculture, mining, and information technology.
Khan said even the IMF had inquired about the SIFC’s powers but that the body would ensure transparency in all transactions.
Regarding the inclusion of Pakistan’s army chief in the SIFC, Khan said the military was key to ensuring physical security for investors.
Earlier this month, Caretaker Prime Minister Anwaarul Haq Kakar hoped to conclude a deal for selling a stake to Saudi Arabia in the Reko Diq by December.
“We are quite excited at the Saudi offer, and we would be very much encouraging their participation, not just in this project but otherwise also,” Kakar had said in an interview with Arab News.