ECC okays $500m hike in Reko Diq cost, development plan

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has granted its nod for upward revision in the cost and development plan of Reko Diq, jacking it up from $6.2 billion to $6.7 billion.

The valuation of Reko Diq has been revised upward by almost $500 million amid negotiations held with the Kingdom of Saudi Arabia for the finalisation of stakes into this multibillion-dollar project.

The KSA has shown its interest and a final deal has been underway but nothing concrete has been finalised so far. Now again there are expectations that the revised valuation of Reko Diq project might pave the way for selling out stakes of the federal government to the KSA within the next few months probably during the ongoing financial year 2024-25.

The ECC has approved the upward revision in the cost of the Reko Diq project and made some key changes in its development plan and related financial commitments due to inflation and enhanced scope of the project.

The Ministry of Finance released an official statement but it did not share any details about the escalation in the figure of valuation of the project.

In the official statement, it was told that the Economic Coordination Committee (ECC) of the Cabinet met on Tuesday with Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, chairing it virtually from China where he is attending the Boao Forum for Asia 2025.

The meeting was attended by Minister for Petroleum Mr. Ali Parvez Malik, Minister for Commerce Jam Kamal Khan, Minister for Board of Investment, Qaiser Ahmed Sheikh, along with the Chairman of SECP, federal secretaries, and senior officials from relevant ministries and divisions.

The ECC took up a summary by the Petroleum Division regarding the Reko-Diq Project and changes in its overall development plan and related financial commitments and project finance considerations due to inflation and enhanced scope of the project concerning capacity, energy mix, alternative water supply options and updated processing plants and machinery.

The ECC noted the factors leading to the project escalations, and approved the proposals contained in the summary with the directions to the ministries of petroleum and finance to continue close coordination with a view to ensuring timely implementation of all agreed actions.

The ECC assured full support for the Reko-Diq project, calling it a project of immense national importance.

The ECC also considered and approved a summary presented by the Ministry of Interprovincial Coordination for a technical supplementary grant amounting to Rs 200 million under the development grant of IPC Division for the construction of PSB Coaching Centre at Skardu.

The ECC, however, urged the Ministry of Interprovincial Coordination to ensure that after its construction, the training facility remains operational and serves the desired purpose in terms of providing sports facilities to local population and serving as a high-altitude training facility for athletes competing at the national and international events.