Japan has shown interest in joining Pakistan’s multibillion-dollar Reko Diq copper and gold mining project, expanding its investment beyond the auto sector. The country is seeking collaboration with local and international investors in the mining venture, The Express Tribune reported.
The Economic Coordination Committee (ECC) was briefed about Japan’s interest in the project. The Finance Division assured the committee that foreign remittances would remain stable and no capital flight would occur.
The proposal includes two types of guarantees: a sovereign guarantee from the government to ensure project completion, and an additional guarantee from the Asian Development Bank (ADB) for Balochistan Mineral Resource Limited (BMRL) equity.
Saudi Arabia has already expressed interest in the project, with plans to acquire a 15 percent shareholding and contribute capital.
According to the Petroleum Division, the project’s equity is valued at 900 million dollars, with half provided by sponsors and the rest by agencies. State-Owned Enterprises (SOEs) will repatriate funds through Pakistan Minerals Private Limited (PMPL) over seven years to meet their 2.145 billion dollar commitment, either as equity or shareholder loans.
The Petroleum Division said the project aims to raise 3.5 billion dollars in financing while giving priority to healthcare, safety, security, and community welfare. Lenders and creditors are directly handling the financing, and representatives stressed the importance of the project.
The ECC noted the potential of the Reko Diq project to transform Balochistan’s economy and deliver significant benefits to Pakistan. The Petroleum Division sought approval for final terms and definitive agreements, including permission for PMPL to repatriate funds for the SOEs’ 2.145 billion dollar commitment.
The foreign exchange needed for the investment will be arranged by Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL) from their own resources. If required, the government will provide additional foreign exchange.
The Petroleum Division also requested approval for BMRL’s repatriation of funds in line with the cabinet’s December 2022 decision. The ECC was asked to authorise the secretaries of the Petroleum and Finance Divisions to finalise and sign the required government guarantees under the Rules of Business, 1973.