Saudi Arabia is edging closer to securing a minority stake in the Reko Diq copper and gold mining project in Pakistan, according to Bloomberg.

Sources familiar with the matter revealed to Bloomberg that Manara Minerals Investment Co., supported by the Saudi sovereign wealth fund, is poised to inject at least $1 billion into the Reko Diq copper and gold mining project, controlled by Barrick Gold Corp.

Insiders suggested that a preliminary agreement outlining the terms of the transaction could be announced in the coming weeks. However, deliberations are ongoing, and there remains the possibility of talks either collapsing or being delayed.

A representative for Saudi Arabia’s Public Investment Fund, a major shareholder in Manara, refrained from commenting on the matter, while queries directed at Barrick went unanswered.

Saudi Arabia's diversification strategy

Saudi Arabia's interest in diversifying its investment portfolio beyond traditional sectors is evident. Pakistan’s Finance Minister Muhammad Aurangzeb confirmed the kingdom's keen interest in various sectors, including metals and mining. Aurangzeb hinted at potential announcements regarding investment ventures in the near future.

The potential deal comes on the heels of a significant meeting between Saudi Crown Prince Mohammed bin Salman and Pakistan Prime Minister Shehbaz Sharif earlier this month. Pakistan has actively presented a wide array of investment opportunities to Saudi delegates, encompassing sectors such as solar energy, hydropower, mining, and technology.

Reko Diq: A strategic project

The Reko Diq project, situated in the Baluchistan region bordering Afghanistan and Iran, is slated to commence production in 2028. Barrick Gold holds a 50% stake in the project, with the federal government of Pakistan owning 25% and the Baluchistan regional government holding the remaining shares.

Saudi Arabia has been engaged in discussions with Pakistan regarding the acquisition of a portion of the government's stake in Reko Diq, as confirmed by Barrick CEO Mark Bristow in a previous interview.

Barrick Gold has affirmed its support for any decision made by the government concerning the involvement of Saudi investors. However, Bristow emphasized that Barrick would not relinquish its equity in the project despite the potential entrance of new stakeholders.