Comment by Riaz Haq on February 6, 2022 at 1:11pm

The average annual copper price is forecast to drop by 6% y-o-y to $8,800 per tonne this year. Boosting supply in the global copper ore market is to push prices down while the worldwide demand languishes with slowed construction activity in China.

https://finance.yahoo.com/news/copper-prices-drop-6-2022-092200072....

In 2020, approx. 1.7M tonnes of copper were exported worldwide, growing by 16% compared with 2019 figures. In value terms, supplies surged to $11.1B.

Zambia represented the major exporter of copper globally, with the volume of exports amounting to 675K tonnes, which was nearly 40% of total supplies. Chile (283K tonnes) ranks second with a 17% share, followed by Bulgaria (7.1%) and the Democratic Republic of the Congo (5%). Belgium (76K tonnes), Namibia (61K tonnes), Spain (56K tonnes), Slovakia (55K tonnes), South Africa (52K tonnes), Pakistan (38K tonnes), the Philippines (34K tonnes) and South Korea (31K tonnes) were a long way behind the leaders.

In value terms, Zambia ($4.2B) remains the largest copper supplier, comprising 38% of global exports. The second position in the ranking was occupied by Chile ($1.7B), with a 16% share of total supplies. It was followed by Bulgaria, with a 9.4% share.

Comment by Riaz Haq on February 21, 2022 at 4:32pm

Barrick Gold Corporation (GOLD) Q4 2021 Earnings Call Transcript


https://www.fool.com/earnings/call-transcripts/2022/02/16/barrick-g...


Tanya Jakusconek -- Scotiabank -- Analyst

OK. And just my last question, if I could, just on your copper strategy. Just wanted to understand a little bit how Reko Diq fits into that strategy and just where we are on this asset?

Mark Bristow -- Chief Executive Officer

So right now, the asset that we have is the arbitration award of which we share with Antofagasta and ourselves, Barrick. We are working and have been in its general knowledge in the spirit of Barrick philosophy of how we can convert that into something that's more meaningful. And that's something that doesn't end up with the Pakistan government having to write out a big check without any benefits. And Reko Diq is an opportunity that we've been working on whereby everyone will benefit.

Our shareholders, of course, and same with the Balochistan government and the Pakistan government. And that's really where I would want to stop it because there's still a lot of work and water to flow under the bridge, but that's the tactic. And as I said, and I think I told Greg at this conference that it's a real asset. And we would like as miners to convert that into our mining asset.

It's one of the better ones around. Otherwise, we end up in conflict and that's not a good thing to do with your host country or potential host country.

Tanya Jakusconek -- Scotiabank -- Analyst

OK. So is it fair to say that this is a ways out in terms of fitting into your 10-year pipeline?

Mark Bristow -- Chief Executive Officer

It would be fantastic in our 10-year pipeline. It's a real deal.

Graham Shuttleworth -- Senior Executive Vice-President, Chief Financial Officer

But it's not in our 10-year pipeline.

Mark Bristow -- Chief Executive Officer

But it's not in -- yes, sorry, it's not in our 10-year pipeline right now.

Tanya Jakusconek -- Scotiabank -- Analyst

I understand that. But in terms of resolving everything and then probably having a feasibility study and other stuff in country, would you be able to even fit it into your 10-year pipeline?

Mark Bristow -- Chief Executive Officer

Sure. Absolutely.

Tanya Jakusconek -- Scotiabank -- Analyst

OK. Great. Thank you.

Mark Bristow -- Chief Executive Officer

Thanks, Tanya.

Operator

Our next question is from Mike Parkin with National Bank Financial. Please go ahead.

Mike Parkin -- National Bank Financial -- Analyst

Hey, guys. Congrats on the good quarter. Just a question with respect to the performance dividend. Does that indicate kind of a comfort level with carrying debt on the balance sheet? Or are you agnostic to where the debt is given that performance dividend is linked to the net cash position?

Mark Bristow -- Chief Executive Officer

So I think you've just answered your own question, Mark. Net cash means there's no net debt. And so the way it's designed is that if we have -- because what we've done initially is our debt to pay it all up is expensive. Hopefully, it gets cheaper and cheaper with the growing interest rates.

But we've offset it. We've got cash balancing the debt. And what we've said is anything above 0. So from zero to $500 million net cash payout of $0.05 dividend and then $500 million to $1 billion and $1 billion to $1.5 billion.

And so that's -- and what it does is it's -- it really is -- it's a nonnegotiable process because if we're investing heavily in a big project, for example, and we drive -- we increased the net debt to fund that. Then we are investing our shareholders' money into that project. And given our return criteria, we think most -- in fact, more than most of our shareholders would support that. If we don't and we build cash on the balance sheet, we make sure that we don't create an easy balance sheet and that on a formulaic basis money goes back to shareholders.

Comment by Riaz Haq on February 22, 2022 at 2:41pm

Details about Reko Diq to be disclosed soon: CM Bizenjo

https://www.dawn.com/news/1668769

CHAGAI: Balochistan Chief Minister Mir Abdul Qudoos Bizenjo said on Monday that details with facts and figures about Reko Diq copper and gold mining project would be disclosed soon.

Talking to local journalists outside Dalbandin airport along with Balochistan Governor Zahoor Ahmed Agha and Rakhshan Division Commissioner Saifullah Khetran, Mr Bizenjo said that for the first time a detailed briefing about Reko Diq project was conducted for the elected representatives of Balochistan at the provincial assembly.

He was referring to a Balochistan Assembly session held last month in which lawmakers from the opposition and treasury benches were given an in-camera briefing on the Reko Diq copper and gold mining project.

In 2019, the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) ordered Pakistan to pay damages of $5.84 billion to Tethyan Copper — a joint venture between Chile’s Antofagasta and Canada’s Barrick Gold — for blocking Tethyan from developing the asset after it had already sunk more than $220 million into the project.

“As we know that we have lost the Reko Diq case in the international court. Therefore, striking a bargain is not easy, but we are trying our best to gain maximum share for Balochistan in this regard,” the chief minister said.

The share of Balochistan in the previous agreement was 25 per cent despite investment by the provincial government, Mr Bizenjo said, adding that the province would get a good share in the upcoming proposed agreement and without having to make an investment.

The chief minister said it had been proposed that the companies involved in Reko Diq project would spend Rs30 to 40 billion during three years for the development of Chagai district besides billions of rupees that would come under the head of corporate social responsibility.

Answering a question, Mr Bizenjo said his government had removed several unnecessary check-posts on highways and more would be removed soon. He also asked the commissioner to remove speed breakers and rooms made for security check-posts constructed on and alongside the main highway.

He also warned that the commissioner, deputy inspector general of police, deputy commissioner, assistant commissioner and tehsildar would be suspended if a security man is found taking bribes at a check-post.

On a lack of healthcare facilities in the district headquarters hospital, he said that all district health officials were directed to purchase medicines and appoint doctors on a contract basis to facilitate the masses.

Comment by Riaz Haq on March 20, 2022 at 1:01pm

Barrick said Reko Diq could now be in production within five to six years. It said the deal would be the springboard for exploring the surrounding area for more reserves.

https://www.wsj.com/articles/pakistan-reaches-deal-with-mining-comp...

Two mining companies resolved a decadelong dispute with Pakistan, officials said, in a deal that will restart work on a giant copper mine and spare the country from having to pay billions in compensation.

Canada’s Barrick Gold Corp. and Chile’s Antofagasta PLC had stopped preliminary work in 2011 when Pakistani authorities refused to grant them a mining license to develop the Reko Diq mine, located in the poor and sparsely populated western province of Balochistan.

Under the agreement, Pakistan will buy out Antofagasta’s interest in the mine for $900 million, according to the two companies and the government. Barrick and Pakistan will split ownership of the mine evenly.

The new deal will represent the largest single investment in the country, Pakistani officials said Sunday, with Barrick and Pakistan investing around $10 billion.

China has invested more than $20 billion in recent years, but that is spread over multiple projects and is the result of a deal between governments of the two countries, rather than an investment from the private sector.

The Reko Diq investment will include about $1 billion in spending on roads, schools and hospitals in the province, as well as creating a technical training institute for mining, Pakistan said. The project is expected to create about 8,000 jobs.

“We always have to keep going back to the IMF because we run short of dollars. Now we’ve taken a big step toward being able to stand on our own two feet,” said Pakistan’s prime minister, Imran Khan, referring to the country’s recurring debt troubles and the International Monetary Fund.

The two companies originally took the case to international arbitration after Pakistani authorities took away their mining licenses in 2011, saying they had rejected a feasibility study by the companies.

The arbitration panel, working under the World Bank, in 2019 ruled against Pakistan, awarding $6 billion in compensation for future earnings of the mine, which was equivalent at the time to around 2% of the country’s gross domestic product, and enough to wipe out much of Pakistan’s foreign-exchange reserves.

The finance minister, Shaukat Tarin, said Sunday that if Pakistan hadn’t reached a settlement, it would have had to pay $11 billion in compensation to the companies, including interest on the unpaid 2019 award, and a further arbitration panel finding that would have gone against Pakistan. If unable to pay, the country’s overseas assets would have also been frozen, he said.

Barrick said Reko Diq could now be in production within five to six years. It said the deal would be the springboard for exploring the surrounding area for more reserves.

Antofagasta said that it decided not to participate in the reconstituted project as the company’s growth strategy is focused on the production of copper and byproducts in the Americas.

Comment by Riaz Haq on March 20, 2022 at 1:02pm

According to details (of the agreement between Pakistan and Barrick Gold), Pakistan and TCC agreed to divide shares with each side getting 50 percent of them. Pertinent to mention, Pakistan had a stake of 25 percent in the previous deal.

https://www.globalvillagespace.com/breakthrough-pakistan-to-get-50-share-in-reko-diq/

Sources claim that Pakistan and TCC will most likely sign the deal in February. If finalized, the deal will avert the threat of imposition of a $10 billion dollar fine on Pakistan.

-------------------

Sources revealed to The Express Tribune that the project’s development would result in an investment of approximately $10 billion in Balochistan, including $1 billion which would be invested in social uplift projects such as roads, schools, hospitals, and the creation of technical training institute for mining. The investment is also said to result in the creation of over 8,000 jobs.

“This project shall make Balochistan the largest recipient of foreign direct investment in Pakistan and the Reko Diq project shall be one of the largest copper and gold mining projects in the world”, sources added.

50 per cent of the new project’s shares will be owned by Barrick Gold, while the remaining shares shall be owned by Pakistan, divided equally between the federal government and the provincial government of Balochistan.

The federal government’s shares of 25% shall be divided equally amongst three state-owned entities (SOE), namely Oil & Gas Development Corporation Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Pakistan Limited (GHPL).

-----------------

The reconstituted project will be held 50% by Barrick and 50% by Pakistan stakeholders, comprising a 10% free-carried, non-contributing share held by the government of Balochistan, an additional 15% held by a special purpose company owned by the government of Balochistan and 25% owned by other federal state-owned enterprises. A separate agreement provides for Barrick’s partner Antofagasta PLC to be replaced in the project by the Pakistani parties.

https://www.barrick.com/English/news/news-details/2022/barrick-pakistan-and-balochistan-agree-in-principle-to-restart-reko-diq-project/default.aspx

Barrick will be the operator of the project which will be granted a mining lease, exploration licence, surface rights and a mineral agreement stabilizing the fiscal regime applicable to the project for a specified period. The process to finalize and approve definitive agreements, including the stabilization of the fiscal regime pursuant to the mineral agreement, will be fully transparent and involve the federal and provincial governments, as well as the Supreme Court of Pakistan. If the definitive agreements are executed and the conditions to closing are satisfied, the project will be reconstituted including the resolution of the damages originally awarded by the International Centre for the Settlement of Investment Disputes and disputed in the International Chamber of Commerce.

Comment by Riaz Haq on July 18, 2022 at 10:09am

Barrick Gold Corporation - Reko Diq Alliance Between Pakistan and Barrick Set to Create Long-Term Value


https://www.barrick.com/English/news/news-details/2022/reko-diq-all...

Subject to the updated feasibility study, Reko Diq is envisaged as a conventional open pit and milling operation, producing a high-quality copper-gold concentrate. It will be constructed in two phases, starting with a plant that will be able to process approximately 40 million tonnes of ore per annum which could be doubled in five years. With its unique combination of large scale, low strip and good grade, Reko Diq will be a multi-generational mine with a life of at least 40 years. During peak construction the project is expected to employ 7,500 people and once in production it will create 4,000 long-term jobs. Barrick’s policy of prioritizing local employment and suppliers will have a positive impact on the downstream economy.

-----------------

ISLAMABAD, PAKISTAN – Finance Minister Miftah Ismail and Barrick president and chief executive Mark Bristow said after their meeting here today that they shared a clear vision of the national strategic importance of the Reko Diq copper-gold project and were committed to developing it as a world-class mine that would create value for the country and its people through multiple generations.

Reko Diq is one of the world’s largest undeveloped copper-gold deposits. An agreement in principle reached between the government of Pakistan, the provincial government of Balochistan and Barrick earlier this year provides for the reconstitution and restart of the project, which has been on hold since 2011. It will be operated by Barrick and owned 50% by Barrick, 25% by the Balochistan Provincial Government and 25% by Pakistani state-owned enterprises.

The definitive agreements underlying the framework agreement are currently being finalized by teams from Barrick and Pakistan. Once this has been completed and the necessary legalization steps have been taken, Barrick will update the original feasibility study, a process expected to take two years. Construction of the first phase will follow that with first production of copper and gold expected in 2027/2028.

“During the negotiations the federal government and Barrick confirmed that Balochistan and its people should receive their fair share of the benefits as part of the Pakistan ownership group,” Bristow said.

“At Barrick we know that our long-term success depends on sharing the benefits we create equitably with our host governments and communities. At Reko Diq, Balochistan’s shareholding will be fully funded by the project and the Federal Government, allowing the province to reap the dividends, royalties and other benefits of its 25% ownership without having to contribute financially to the project’s construction or operation. It’s equally important that Balochistan and its people should see these benefits from day one. Even before construction starts, when the legalization process has been completed we will implement a range of social development programs, supported by an upfront commitment to the improvement of healthcare, education, food security and the provision of potable water in a region where the groundwater has a high saline content.”

Finance Minister Ismail said the development of Reko Diq represented the largest direct foreign investment in Balochistan and one of the largest in Pakistan.

“Like Barrick, we believe that the future of mining lies in mutually beneficial partnerships between host countries and world-class mining companies. The Reko Diq agreement exemplifies this philosophy and also signals to the international community that Pakistan is open for business,” he said.

Comment by Riaz Haq on November 14, 2022 at 10:32am

REMs – the most precious commodities
Pakistan should hire experts, finance rare earth metal projects through budget


https://tribune.com.pk/story/2207557/rems-precious-commodities


REMs constitute a group of 17 elements that occur together in the periodic table, including yttrium and 15 lanthanides. The use of REMs within industrial sectors is both high stakes and high wager.

These sectors include defence, electronics, medicinal, industrial, automotive, etc and they are used in specialised applications such as aircraft engines, nuclear batteries, lasers, magnets, optic fibres, high-strength alloys, superconductors, storage disks, signal amplifiers, to name a few.

------------

REMs deposits in Pakistan have been discovered in Khyber-Pakhtunkhwa (Koga, Tarbela, Jawar), Gilgit-Baltistan (Gilgit, Skardu), and Balochistan (Reko Diq, Chagai, Saindak).

Initial geochemical analysis showed that 12 out of 17 REMs had been found with varying potential. Still, the exact size is yet to be determined and required an in-depth exploration study. REMs are the most precious commodities today and Pakistan needs to place maximum bets on it to cash in on the opportunities. Realistically, Pakistan is not a manufacturing or a processing country, hence, it should earmark the commerce potential with both revenue from sales and barter trade.

Due to REMs strategic importance, an organisational setup should be put in place, under the prime minister, and in close collaboration with supporting arms of armed forces and Pakistan Atomic Energy Commission.

The entire exercise can be done in stages with exploration, extraction, ramp-up production and global marketing with mass production over a five-year timeline.

Experts should be freshly hired or may be brought from different government departments (Geological Survey of Pakistan, Survey of Pakistan, Khan Laboratories, etc), including geologists, radiometric surveyors, drilling/smelting specialists, and security experts.

The project financing should come from the national budget under the ambit of “special strategic projects”. The global REMs market is valued at $10 billion with an 8-10% CAGR and production of 170,000 tons per annum by 2022. If Pakistan secures 2-5% of this market share – with annual output of 3,500-8,500 tons, it can inject $1-2 billion per year into the national pocket over the next five to seven years.

This could change Pakistan’s international status as a high-value player at a high stakes table in the global arena.

The writer is a PhD in Engineering from the University of Cambridge, United Kingdom. He currently serves as Vice President of Core Group in Pakistan

Comment by Riaz Haq on January 2, 2023 at 8:05am

Barrick Gold strikes final deal with Pakistan for Reko Diq project
Published by Joe Toft, Editorial Assistant
Global Mining Review

https://www.globalminingreview.com/mining/30122022/barrick-gold-str...

Barrick Gold Corporationhas announced that it has completed the reconstitution of the Reko Diq project, having received a favourable opinion from the Supreme Court of Pakistan and the required legislation having been passed into law.
One of the largest undeveloped copper-gold projects in the world, Reko Diq is owned 50% by Barrick, 25% by three federal state-owned enterprises, 15% by the Province of Balochistan on a fully funded basis and 10% by the Province of Balochistan on a free carried basis.

Barrick president and chief executive Mark Bristow said the completion of the legal processes was a key step in progressing the development of Reko Diq into a world-class, long-life mine which would substantially expand the company’s strategically significant copper portfolio and benefit its Pakistani stakeholders for generations to come.

“We are currently updating the project’s 2010 feasibility and 2011 feasibility expansion studies. This should be completed by 2024, with 2028 targeted for first production,” Bristow said.

“With its unique combination of large scale, low strip and good grade, Reko Diq is expected to have a life of at least 40 years. We envisage a truck-and-shovel open cast operation with processing facilities producing a high-quality copper-gold concentrate. We expect it to be constructed in two phases with a combined process capacity of 80 million tpy.

Reko Diq will be a major contributor to Pakistan’s economy which is expected to have a transformative impact on the underdeveloped Balochistan province where, in addition to the economic benefits it will generate, the mine will also create jobs, promote the growth of a regional economy and invest in development programs. The province’s interest in the mine will be fully funded, which means that Balochistan will reap the dividends, royalties and other benefits of its 25% shareholding without having to contribute financially to its construction and operation.

“Reko Diq’s ownership structure is a further manifestation of Barrick’s commitment to partnership with its host countries and communities and to sharing the value our operations create fairly with all our stakeholders,” Bristow said.

“We’re making sure that Balochistan and its people will see these benefits quickly. Starting early next year, Barrick will implement a range of social development programs prioritising the improvement of healthcare, education, vocational training, food security and the provision of potable water. Our investment in these is expected to amount to around US$70 million over the feasibility and construction period. In addition, Reko Diq will advance royalties to the government of Balochistan of up to US$50 million until commercial production starts.”

During peak construction the project is expected to employ 7500 people and once in production it will create around 4000 long-term jobs. As elsewhere in the group, Barrick prioritises the employment of local people and host country nationals.

Bristow said Barrick already had the industry's best gold assets and the addition of Reko Diq would promote its copper portfolio into the world-class league, accelerating the company towards its goal of creating the world's most valued gold and copper mining business.

Comment by Riaz Haq on January 24, 2023 at 4:41pm

Surging demand for copper means its price is rising too

https://www.marketplace.org/2023/01/24/surging-demand-for-copper-me...

The world cannot seem to get enough copper. This metal is mined in places as disparate as China, the Democratic Republic of Congo and Utah.

Copper prices have risen around 10% since the start of this year, in part because the metal is crucial to renewable energy technology and the transition away from fossil fuels.

Copper is often referred to as “Dr. Copper,” because it’s considered a barometer for the health of the global economy.

Traders like to play off that saying, according to Bobby Iaccino, co-founder of Path Trading Partners.

“They say copper has a Ph.D. in economics,” he said. “That still doesn’t really explain it, OK? So anywhere where there’s electricity, there’s copper usage.”

Demand for copper is especially high now as the market for renewable energy expands, said Michael Klare, a professor emeritus at Hampshire College.

“You’re going to need a lot more copper for wiring to connect various sources of renewable energy — wind farms and solar farms — to wherever you’re going to use the renewable energy,” Klare said.

And in electric vehicles, the amount of copper needed can be more than double what’s used to make traditional gas-powered vehicles.

This year’s surge in copper prices is in part due to China and its emergence from pandemic-related shutdowns, said Rohan Reddy, director of research at Global X ETFs.

“China makes up about half of all global copper demand. So typically, there’s a saying, ‘As China goes, so does copper,'” Reddy said.

That’s the other copper adage you’ll hear a lot — and one that seems to be holding true. The question now is what happens next in China, said Bart Melek, global head of commodity strategy for TD Securities.

“We continue to see a very significant amount of infections in that country,” Melek said. “And that is something that will take time to work its way through.”

That’s why Melek’s call on copper for the coming months is relatively cautious. Rising interest rates, a potential global economic slowdown — all of it, he said, could take the shine off copper demand.

Comment by Riaz Haq on March 5, 2023 at 1:57pm

Lithium, fresh silver lining on economic horizon of Pakistan
By Yasir Masood | Gwadar ProDec 12, 2022

https://gwadarpro.pk/1602212868140138497/lithium-fresh-silver-linin...


Pakistan possesses substantial lithium reserves. According to the Metal Mining Agency of Japan, these reserves may fulfil global demand for nearly 500 years. With China and India, two of Pakistan's major trading partners, investing extensively in electric vehicles (EVs), Pakistan has a significant chance of becoming a bigsupplier and a major consumer of this essential commodity.

“Given the existence of favorable geological environments in Pakistan which are found elsewhere for the occurrence of Lithium on a global level, Balochistan, KPK, and GB Provinces have been identified as target areas for finding this commodity in substantial quantities”, said Mr. Muhammad Yaqoob Shah, ex-General Manager (Geology) Pakistan Mineral Development Corporation Islamabad.

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