The federal government is considering selling the shares it now owns in the Reko Diq project to Saudi Arabia in order to attract investment from the Gulf state, reported The News International.
According to the revised agreement, Barrick Gold Corporation of Canada holds 50 per cent of the shares, and Antofagasta of Chile has withdrawn from the project in exchange for USD million deposited by three federal government agencies: Oil & Gas Development Company Limited, Pakistan Petroleum Limited, and Government Holdings Private Limited.
These organisations own 25 per cent of the project, while Balochistan owns the remaining 50 per cent. Ten per cent of them are free-carried, and fifteen per cent are fully supported.
In a letter to the federal entities, the newly established Special Investment Facilitation Council (SIFC) requested that the deal with Saudi enterprises be completed in the upcoming months. According to a person with knowledge of the situation, the original directive called for the necessary action to be taken by the end of December, but the deadline was later extended till the end of March next year, The News International reported.
Government Holdings Private Limited (GHPL) was not required to do this because it is not listed with PSX, but it has come to light that PPL and OGDCL have disclosed this important information with PSX as well.
"We are pleased to disclose that the Board of Directors at its meeting held on September 28th, 2023 has decided to evaluate a potential engagement with sovereign foreign investors with respect to the Reko Diq Project and has decided to appoint advisors through its associated company M/s Pakistan Minerals (Private) Limited to assist in this regard," reads the information posted by PPL in compliance of the rules of the Securities Act, 2015 and of PSX regulations, according to The News International.
The News also contacted SIFC for additional confirmation. According to a high-ranking official who confirmed the development, Saudi Arabia is interested in investing in the current project because, like any investor, the Saudis don't want to take risks by entering an uncharted mining region.
Pakistan had requested that Saudi Arabia conduct exploration in a separate block of Reko Diq. In order to have a better discussion, the share value is being determined by a third party, he said, keeping that in mind.
The top official further stated that the Saudi investors have their own shareholding structure when asked if they are Saudi corporations or the Saudi government.
Even if the corporation is privately held, the Saudi government will still hold some of the shares. He claimed that although the federal government wasn't particularly eager to sell its holdings, it nonetheless planned to do so in the hopes that this action would spur more investment in other fields.
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