Federal Minister for Energy (Petroleum Division), Ali Pervaiz Malik, stated that the Reko Diq Project will be Pakistan’s largest Western investment, projected to generate over $75 billion in free cash flows over its 37-year mine life. With commodity price escalation, this may exceed $100 billion.
According to a written response in the National Assembly, Phase-1 production will start in 2028, targeting 300,000 ounces of gold and 200,000 tons of copper annually. Phase-2, beginning in 2034, aims for 500,000 ounces of gold and 400,000 tons of copper annually.
The project structure allocates 25% ownership to Balochistan, with significant revenues from taxes and royalties benefiting Pakistan, especially Balochistan. Key fiscal terms include a 5% royalty to the Balochistan government, a 1% net smelter return to the federal government, and a 0.5% export processing zone surcharge.
To support Balochistan during development, the Project Company committed to advance royalty payments: $5 million in year 1, $7.5 million in year 2, and $10 million annually up to a total of $50 million before production begins.
The construction timeline is: Phase-1 from 2025–2028, Phase-2 from 2028–2033. Environmental protections, community development, and local business opportunities are prioritized, with $5.3 million spent on health, education, training, and clean water since 2022.
During construction, 1% of capital (around $57 million for Phase-1 and $33 million for Phase-2) will be allocated for local development; $10 million has already been paid in advance. In the operating phase, 0.4% of annual revenue—about $25 million—will go to development efforts.
The project will create 7,500 peak construction jobs and 4,000 long-term positions. Currently, 75% of Reko Diq Mining Company’s workforce is from Balochistan. A board led by Balochistan’s chief secretary, including federal and company representatives, oversees the project.
