Out of Africa: Mark Bristow talks about an ESG model for Reko Diq
- 3 August 2024
Barrick Gold CEO Mark Bristow says the global gold major has “already changed the lives” of people in the impact zone of the planned, giant Reko Diq copper-gold mine in southwestern Pakistan as it seeks to repeat an ESG formula refined in Africa to open up what is effectively a new frontier for mining.
Speaking on a call with investors after Barrick published its latest annual sustainability report, Bristow suggested there was “no better example than Reko Diq” of a mining asset with the mineral endowment to drive not only significant owner shareholder returns but also a “substantial amount of investment and distribution back into [host] regions”.
Barrick owns 50% of Reko Diq with Pakistan’s national government (25%) and the provincial Balochistan (25%) controlling the balance. The project was suspended back in 2011 when Barrick and its then partner Antofagasta had a development licence rejected by Pakistan’s government.
After a decade of international legal fighting and arbitration, the project was reconstituted in 2022 and then Pakistan prime minister Imran Khan said a mooted US$10 billion development could create the largest copper and gold mine in the world and “usher in a new era of development and prosperity” for the region.
Current resources estimated to contain 12.3 million tonnes of copper and 20.9 million ounces of gold could underpin an operation producing at least 200,000t of copper and 250,000oz of gold annually year for more than 50 years starting later this decade.
“I’ve always said that asset quality is a big driver in developing regions,” Bristow, a keynote speaker at Resourcing Tomorrow 2024 in London, said this week.
“If you look at what we’ve done at Reko Diq … Today we have changed the lives of the people within the impact zone of Reko Diq.
“Life expectancy was below 50 years old in that whole region because of saline water and lack of availability of pure, clean drinking water. And now all of the communities have that.
“We’ve got just over 200 employees [in-country] as we embark on what we call the initial starter projects.
“We have aspirations to train [local] people so they can participate in the development of Reko Diq, and get a priority as far as employment goes.
“Our strategy is to invest in school-going children for the future.
“Those who have not been at school but are in the teens age group, we have established technical training colleges and vocational learning so they can participate in the construction and ultimately the operation of the mine.
“And then we’ve gone to all the universities across Pakistan and canvassed applications for our graduate development program. What we’re looking for is the crème de la crème of young graduates.
“The first intake was nine students – five boys and four girls – 18 months ago. Those graduates are busy working in our [international] mines.
“We have just taken on another 19. And the idea is we will build that cohort up to about 50 and that will be the future middle management of Reko Diq.
“What we’re managing in this society now is this absolute obsession by everyone to be part of Reko Diq because it gives them a job.
“If you don’t work for the army or the government [in this region], you’re a smuggler. That’s about the only other option.
“There is a real desire for employment. And what we’ve been able to do there is offer that employment.
“And we pay way above the wages in that part of the world.
“It’s an opportunity to liberate people both economically and politically.
“We started with education at pre-primary school level … the future workers and businesspeople for Reko Diq. Those schools have approximately 50% boys and girls in them. We encouraged [local people] through our community development committees to … get their children to school. Our objective is to have every kid under 10 years old at school. And we’re very close to achieving that even today.
“So it’s about primary education, primary health and then looking to develop a business community as well within those regions. And we’ve done that in every country we’ve invested in.”
Bristow cited Barrick’s 45%-owned, 10-year-old Kibali gold mine in the northeast of the Democratic Republic of Congo – “a flagship mine in the DRC” – which is about 220km east of the provincial capital, Isiro, and 150km west of the Ugandan border town of Arua.
“We’ve learnt so much at Kibali where we did the same thing [as Reko Diq blueprint] … We opened a mine up in the middle of the jungle where there was no skills base at all. Today the mine is run by Congolese and it’s one of our most automated gold mines in the world and it’s a lot more efficient than even our Nevada mine.
“It’s a real example of what you can do if you invest in national skills rather than dragging in expatriates into these remote regions.”
Asked about negotiating high levels of risk – financial, geopolitical, traditional land-owner and local community opposition, environmental and governance – connected to projects such as Reko Diq, near Pakistan’s borders with Afghanistan and Iran, Bristow indicated Kibali, again, offered a model.
“It’s about how we behave in that country,” he said.
“It starts with our management, our engagement with the local community, and then grows from there to the regional authorities, both traditional – we recognise traditional authorities – and then the appointed authorities, and then from that we work back up to the federal or national leadership.
“This [Reko Diq] is a couple of hundred kilometres from the Afghan border and tribes are very small there and there are many of them.
“When we were negotiating with … Imran Khan’s government to set the framework on how we would go back and develop the Reko Diq project I along with the traditional leadership toured the whole region around Reko Diq and met with the elders, the traditional leaders … and presented our plans.
“At times we had representation from the federal government in Islamabad, but we always had representation from the local elected government of Balochistan and of course the traditional leaders.
“And it’s interesting that in nearly every situation the frustration of voice was against the decision to cancel the mining permit for Reko Diq … and the desire to see this mine get developed.
“I would just point out to that the tribe that is actually located on the footprint of Reko Diq took it upon itself to look after the Reko Diq infrastructure and when I got there back in 2019 the offices and that were still absolutely intact and even the t-shirts in their cellophane were sitting on the shelves.
“All the jerry cans were there; everything was there and that tribe had guarded that place for just under 10 years.”
