ISLAMABAD (PEN) : The International Finance Corporation (IFC) is set to provide a subordinated loan of \$400 million to support the development of Pakistan’s Reko Diq copper-gold mine, according to an official IFC disclosure.
This latest loan supplements an earlier \$300 million commitment made in April, bringing IFC’s total investment in the project to \$700 million. The overall estimated cost of the Reko Diq mine stands at \$6.6 billion, which will be financed through a combination of debt and equity contributed by a consortium of lenders.
“The estimated total Project cost is \$6.6bn, and it will be financed using a combination of debt and equity,” the IFC statement noted, further adding that other lenders will provide the remaining debt portion.
Subordinated debt, like the loan provided by IFC, is typically repaid after senior loans, helping to absorb greater risk and thereby facilitating investment from other financiers.
Consortium of International Lenders
Besides the IFC, other major financiers expected to join the funding package include the U.S. Export-Import Bank (EXIM), Asian Development Bank (ADB), Export Development Canada, and Japan’s Japan Bank for International Cooperation (JBIC). Tim Cribb, project director for Reko Diq, indicated that term sheets are anticipated to be finalized early in the third quarter of this year.
Project Overview and Impact
Reko Diq, located in Pakistan’s resource-rich Balochistan province, ranks among the world’s largest undeveloped copper-gold deposits. The mine is being developed by Barrick Gold, holding a 50% stake, with the remaining ownership shared between Pakistan’s federal and provincial governments.
Production is projected to commence in 2028. Barrick Gold estimates that the mine could generate up to \$74 billion in free cash flow over its anticipated 37-year operational lifespan.
Earlier this year, IFC Chief Makhtar Diop emphasized the institution’s commitment to Pakistan, highlighting infrastructure, energy, and natural resources as key focus areas.
