|Pakistan Supreme Court considers petition against Reko Diq copper-gold mine development|
by Lawrence Williams, Mineweb
Reports from Pakistan say the country's Supreme Court has issued notices to both the Federal and Balochistan governments regarding a petition against the award of the huge Reko Diq copper/gold development to foreign entities (namely Barrick Gold and Antofagasta). It puts the value of the project at some $260 billion.
Reko Diq is a very large copper/gold project in a sensitive area of western Pakistan. According to Barrick, which has Reko Diq in its medium term mine development programme, it is described as a large copper-gold porphyry mineral deposit on the Tethyan belt in Balochistan, in which Barrick hold a 37.5% interest. (The holding is through Tethyan Copper Co. (TCC) - a JV with Antofagasta with TCC controlling 75% of the deposit and the Balochistan Government the balance). The total resource is put at around 42 million ounces of gold in the Measured, Indicated and Inferred categories and nearly 54 billion pounds of copper. It is in the same area as the existing Saindak copper project which is operated by the Metallurgical Construction Company of China whose lease runs out next year and which may then revert to the Balochistan government..
Barrick puts its share of average annual production from Reko Diq for the first five full years as about 100,000 ounces of gold at total cash costs of $420 - $450 per ounce and 150 - 160 million pounds of copper at total cash costs of about $1.00 - $1.10 per pound. The initial mine development feasibility study is complete and the social and environmental impact assessment is in its final stages. The feasibility study indicates pre-production capital of approximately $3.3 billion (100% basis) based on a 120,000 ton per day processing plant, which is capable of future expansions.
The project is considered as highly controversial in the region and has already gone through a stage where it was rejected by the Balochistan government, which appears to have some designs on taking over the whole project itself, and then re-instated. There is local opposition too in what is a very politically sensitive area of a very politically sensitive region of the world.
The latest petition against the development has been brought by a
local group regarding the principle of leasing out gold and copper mines
in Balochistan to foreign companies by the federal government. The
petition also suggests that the deposit includes big reserves of
uranium, which again raises the sensitivity of the development in the
region, which borders on Iran to the west and Afghanistan to the north.