The Asian Development Bank (ADB) has approved funding to develop one of the world’s largest unexploited copper deposits in southwest Pakistan – but critics warn the plan to extract the key energy transition metal in a region blighted by insurgency and human rights violations carries “excessive risks”.
On Friday, the ADB confirmed it had approved a $410-million financial package for the Reko Diq copper-gold mine, which will be operated by Canadian mining giant Barrick Mining Corporation.
The mine is located in Pakistan’s Balochistan province, which forms part of a wider region of the same name with a distinctive cultural identity straddling Pakistan, Afghanistan and Iran.
Balochistan is Pakistan’s largest and poorest province, despite its vast natural resources including copper – a key ingredient in virtually all clean energy technology that is pivotal for the global shift towards electrification.
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Local groups in Balochistan have led a decades-long struggle against the Pakistan government for greater autonomy for the Baloch people.
Militant insurgencies have escalated in recent years and the Pakistan government has responded with a violent crackdown and counter-terrorism measures which UN experts say violate human rights. Earlier this year, they condemned the enforced disappearance of thousands of people and alleged widespread torture, extrajudicial killings and indiscriminate violence by security forces, especially against peaceful protesters and Baloch human rights defenders.
Strategy to support ‘responsible’ minerals value chains
The ADB said the mine will contribute to the clean energy transition by helping to meet rising copper demand and will spur economic development in the region by creating thousands of jobs.
It is the first mining project the Philippines-based bank has supported since launching a strategy to develop “responsible and sustainable critical minerals-to-manufacturing value chains” in Asia-Pacific.
The ADB funding for the mine comes on top of $700m in loans approved by the International Financial Corporation (IFC), the World Bank’s private arm, earlier this year.
Before the ADB decision, a coalition of civil society groups called on international financiers in an open letter to reconsider support for the project, citing “excessive” security, human rights and environmental risks.
“In a highly militarised region, where critical voices are routinely silenced, investing in such a large-scale, controversial project is a recipe for disaster,” said Tala Batangan, Asia regional coordinator for the Coalition for Human Rights in Development.
In a lengthy response published on its website, mining company Barrick rejected the accusations. It said the company is “committed to responsible mining and sharing the benefits of its operations with local stakeholders and partners, based on open and transparent engagement and the highest environmental and social safeguards”.
An ADB spokesperson said: “We recognise that mining is a complex sector. We listen closely to all concerns raised by our stakeholder groups including civil society organisations, and we will respond to their correspondence in due course.”
The Reko Diq copper and gold mine
Located in a sparsely populated, arid area, the Reko Diq copper-gold mine is owned 50% by Barrick and 50% by the Pakistan government and the government of Balochistan.
Production is expected to start by the end of 2028. The $6.6-billion mine is due to produce 200,000 tonnes of copper and 250,000 ounces of gold per year in its first phase. The second phase will double production.
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Barrick says the mine has proven reserves that would last for at least 37 years.
A consortium of lenders is helping finance the project. Barrick said it is in talks with export credit agencies in the US, Canada, Germany, Sweden and Finland.
Booming copper demand is on track to outstrip supply, and the International Energy Agency is warning of a significant shortfall within the next decade.
Campaigners call inclusion plan ‘highly problematic’
Campaigners, however, argue that the mine risks exacerbating the insecurity of human rights defenders.
In the letter signed by 36 international groups and sent to the ADB and the IFC this week, they urged lenders to pause funding for the project until security and rights concerns have been addressed.
“While we understand that copper is considered to be a critical mineral for the energy transition, extraction projects must also respect human and environmental rights,” they wrote. The letter cites recommendations from a UN Secretary-General panel on energy transition minerals that “human rights must be at the core of all mineral value chains” and that the sector must promote peace and security.
The project, they say, “does not meet these standards”.
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Specifically, campaigners say it is “impossible” to ensure meaningful engagement with local communities given the “atmosphere of fear and repression” in the region. Earlier this year, members of a human rights group were detained in what UN experts say “may amount to reprisals for their interaction with United Nations mechanisms”.
Local groups in Pakistan have been afraid of opposing the mine over similar fears, one campaigner told Climate Home News.
“When people are too afraid to even speak out or raise questions, consultations can’t be considered meaningful,” said Batangan.
The letter adds that the company’s plan to work with the Balochistan government to ensure the Baloch people and other marginalised groups are represented in the project’s decision-making process is “highly problematic” given the ongoing conflict with state security agencies.
Campaigners argue that the ADB and IFC’s commitments to invest sensitively in fragile contexts and prevent harms to local communities cannot be upheld in the current context.
Barrick cites ‘overwhelming’ local support
In its response to the campaigners’ letter, Barrick rejected allegations that lenders will not be able to uphold their environmental and social safeguards for the project and accused some of the signatories of being “anti-mining and anti-development”.
The company recognised the “broader security concerns in the region” and said the project’s impact assessment had been carried out to international best practice, as well as undergoing additional due diligence by lenders.
It described accusations that meaningful consultations would not be possible as ignoring “the extensive engagement undertaken and the efforts to ensure such engagement is open, culturally appropriate, and includes appropriate safeguards”. Local communities, it added, “overwhelming support the project”.
The IFC said all its projects must comply with comprehensive environmental and social requirements, adding it is “committed to engaging in constructive dialogue with civil society organisations on matters related to its investments”.