$900MM finalised for Chilean firm to exit Reko Diq project
ISLAMABAD: After the Supreme Court settled a settlement deal worth over $6.5 billion last week, the Government of Pakistan on Sunday finalised a payment of more than $900 million to the Chilean firm Antofagasta over six years to exit the Reko Diq project.
The committee also green-lighted about $1.91 billion shareholder financing by state-owned enterprises (SOEs) to take the gold and copper mining project forward.
The decisions were taken at a special meeting of the Economic Coordination Committee (ECC) of the cabinet headed by Finance Minister Ishaq Dar through video link from Lahore to meet deadlines for an out-of-court settlement with the Tethyan Copper Company to avoid a looming $10bn international arbitration award. The ‘definitive agreements’ are to be simgned by December 15 under the settlement deal.
Under the agreement, the government and its entities like the OGDCL, Pakistan Petroleum Limited and Govt Holdings Pvt Limited (GHPL) have already deposited $900 million in an escrow account for payment along with interest in six years to Antofagasta Minerals of Chile to exit the project.
These entities are also required to arrange about $4.3 billion equivalent funds as an equity investment in the restructured project, now it is named Barrick Reko Diq Holdings Limited (BRDHL), to be operated by Canada’s Barrick Gold Corporation mining company.
“The ECC considered and approved two important agenda items related to the Reko Diq project, thus paving the way for early start of the Reko Diq Project,” an announcement said after the meeting.
$900MM finalised for Chilean firm to exit Reko Diq project
It added that it allowed the concerned divisions of the government and the SOEs to act in such a manner to ensure that the deposited amount along with interest deposited by the SOEs in the escrow account to form part of the consideration for share purchase of the Reko Diq Mining Company Limited.
