Tethyan Copper Co., a joint venture of Antofagasta plc and Barrick, announced on May 8 that it has withdrawn its request for specific performance in the international arbitrations it has brought against the governments of Pakistan and the province of Balochistan in Pakistan. As a result, Tethyan will no longer seek the grant of a mining lease for its Reko Diq copper-gold project in the Chagai district of northwest Balochistan and instead will seek solely monetary damages as compensation for Pakistan’s and Balochistan’s breaches of Tethyan’s contract and treaty rights.
The government of Balochistan province rejected Tethyan’s application for a mining lease for the Reko Diq project in November 2011. Tethyan had submitted the application in February 2011, following submission of the project feasibility study in August 2010.
On November 29, 2011, Tethyan filed for international arbitration to protect its legal rights at its Reko Diq.
Antofagasta acquired Tethyan Copper and formed its joint venture with Barrick in April 2006. The companies invested more than $220 million in the project prior to the denial of the mining license in November 2011.
The Reko Diq deposit is a large, low-grade copper porphyry. The economically mineable portion of the deposit has been calculated at 2.2 billion mt, averaging 0.53% copper and 0.30 g/mt gold. Annual production was estimated at 200,000 mt of copper and 250,000 oz of gold contained in 600,000 mt of concentrate over a 56-year mine life.
Mining would have been from an open pit at a rate of 110,000 mt/d of ore (293,000 mt/d combined ore and waste). Capital investment to develop the project was estimated at $3.3 billion, including infrastructure.