Barrick quashes Pakistan dispute, paving way for giant new gold-copper project

Barrick Gold will start to develop one of the world’s biggest gold and copper deposits after ending a long-running dispute with host country Pakistan.

Barrick and Pakistan signed an out-of-court agreement yesterday waiving an US$11 billion penalty on Pakistan handed by a World Bank arbitration court, after the government denied Barrick and its Chilean partner Antofagasta a development licence for the Reko Diq project in 2011.

Pakistan Finance Minister Shaukat Tarin said Barrick and its partners will now invest $10 billion in the project that was discovered at the foot of an extinct volcano in the Balochistan region on Pakistan’s borders with Iran and Afghanistan.

Barrick will operate Reko Diq after it is granted a mining lease, exploration licence and surface rights. Antofogasta, however, has agreed to exit the project as its growth strategy is now focused on copper and by-products in the Americas.

“The new project company shall be owned 50% by Barrick Gold. The remaining 50% shareholding shall be owned by Pakistan, divided equally between Federal Government and the provincial government of Balochista,” a statement from the office of Prime Minister Imran Khan said after the signing ceremony in Islamabad.

Meanwhile, Barrick’s president and CEO Mark Bristow hailed the agreement as an important step towards the development and operation of Reko Diq and a tribute to the decisions of all parties to work towards a mutually beneficial outcome in a spirit of partnership.