PM Shehbaz orders direct railway link to boost multi-billion dollar Reko Diq project

• Committee formed to explore financing options for PR upgrade
• Project expected to boost cargo services, mineral transport.
• Saudi firm plans up to $1bn investment in Reko Diq mine.
  

Prime Minister Shehbaz Sharif on Tuesday ordered authorities to connect the Reko Diq project in Balochistan to the Pakistan Railways (PR) network by 2028 to support future transport and cargo needs.

The move will support the development of the mine, one of the world's largest underdeveloped copper-gold deposits, which is hoped to generate $70 billion in free cash flow and $90 billion in operating cash flow. 

American miner Barrick Gold owns a 50% stake in the Reko Diq mine, and the governments of Pakistan and the province of Balochistan own the other 50%. 

The mining giant considers the project to have a significant impact on Pakistan's struggling economy.

While chairing a meeting today, PM Shehbaz issued orders for the formation of an inter-ministerial committee to look after financing matters for upgrading and developing Pakistan Railways.

The committee will present recommendations regarding the financing required for Pakistan Railways’ development and its extension to Reko Diq.

During the meeting, the prime minister was briefed on the upgradation of ML-1 and ML-3 railway as well as the overall development of Pakistan Railways to meet the requirements of future transportation and cargo services.

The premier noted that Pakistan Railways served as a backbone for the country’s economy and communication.

“Pakistan Railways is a cheap, fast and environment-friendly source of transportation,” PM Shehbaz said.

He added that the mines and mineral sector of Balochistan will develop, and new employment opportunities will be created for the people of the area after linking railways with Reko Diq.

Saudi Arabia’s Manara Minerals announced in January that it plans to acquire a 10–20% stake in the Reko Diq copper and gold project, with the deal expected to bring in $500 million to $1 billion.

In April, shareholders of the Reko Diq Joint Venture approved a revised feasibility study and gave conditional approval for Phase-1 development, subject to securing up to $3 billion in financing.

The project, which was delayed due to a long-running dispute that ended in 2022, is expected to start production by the end of 2028. It will produce 200,000 tons of copper per year in its first phase, with an estimated cost of $5.5 billion. The first phase is expected to be completed by 2029.

The meeting was attended by Deputy Prime Minister and Foreign Minister Ishaq Dar, Defence Minister Khawaja Asif, Minister for Economic Affairs Ahad Khan Cheema, Minister for Maritime Affairs Junaid Anwar Chaudhry, Minister of State for Railways Bilal Azhar Kayani, Special Assistant to the Prime Minister Tariq Fatemi, and senior government officials.