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ISLAMABAD, April 13: Major reserves of copper and gold in Balochistan’s Rekodiq area have been discovered which would contribute about $1.25 billion annually to the national economy, it is learnt.

“This is a major discovery by all international standards”, a senior government official told Dawn on Wednesday. The president or the prime minister will make a formal announcement after completing legal formalities, he said.

The Rekodiq mining area has proven estimated reserves of two billion tons of copper and 20 million ounces of gold. According to the current market price, the value of the deposits has been estimated at about $65 billion, which would generate thousands of jobs.

The size of Pakistan’s national economy (GDP) at present is about $104 billion.

Balochistan government has 25 per cent stake in the Rekodiq project. Rest of the 75 per cent stakes of the project have now been taken over on 50:50 basis by Antofagasta of Chile and Barrick Gold of Canada.

“The discovery has ranked Rekodiq among the world’s top seven copper reserves”, said an industry expert requesting not to be named for political reasons associated with ongoing security operation in the province.

“This is a quantum jump....the mineral resources may contribute to the national economy despite inadequate support this sector gets from the government”, he added.

The Rekodiq project is estimated to produce 200,000 tons of copper and 400,000 ounces of gold per year, at an estimated value of $1.25 billion at current market prices. The copper and gold are currently traded at about $5,000 per ton and $600 per ounce respectively in the international market.

The project will, however, require about $1 billion investment to start commercial production by 2010. It has so far consumed about $50 million to prove two billion tons of copper and 20 million ounces of gold.

The presence of a mineral deposits in the area was identified by the Geological Survey of Pakistan in early 1990s in collaboration with BHP Billiton of Australia.

Later in 2000, Tethyan Corporation (TCC) of Australia took over the project from BHP and invested $30 million by raising funds through international listing and drilled over 75,000 meters to prove the reserves.

The TCC has recently been taken over by two of the world’s largest copper and gold mining firms — Antofagasta of Chile and Barrick Gold Corporation of Canada. The market capitalisation of Barrick alone is estimated at over $25 billion. This is the first private sector funded mining venture in Pakistan.

The chairmen of the two mining majors — Jean Paul Luksic of Antofagasta and Gregory Charles Wilkings of Barrick — also had a meeting with Prime Minister Shaukat Aziz on Tuesday to inform him about their successful take over of TCC at 158 million Australian dollars (about $130 million or Rs8 billion).

Pakistan is rich in mineral resources waiting to be tapped by both domestic and foreign investors by bringing in latest techniques and state-of-the-art technology in this sector, the prime minister told the two investors. He said the logistics chain would be improved throughout the country to facilitate the movement of cargo. He hoped that Gwadar Deep Sea Port would be a hub for export of mining products from Balochistan.