Jago Times "English Edition" Best Online Newspaper
Related Articles
The Supreme Court (SC) on Friday declared an agreement signed between the Pakistan government and two international firms — Antofagasta PLC and Barrick Gold Corporation — in March for the revival of the long-stalled Reko Diq mining project as legal.
The verdict was pronounced by a five-member SC bench, headed by Chief Justice of Pakistan Umar Ata Bandial, on a presidential reference that sought the SC’s opinion on whether a 2013 judgement by the apex court prevented the federal and provincial governments from entering into the implementation agreement afresh.
In its 13-page short order issued today, the court observed that the government had entered the agreement after consulting experts, as per court directives, and the Balochistan Assembly was taken into confidence regarding the agreement.
The order stated that the law did not allow agreements on national resources in violation of the Constitution and that provinces could amend laws pertaining to minerals.
The court observed that the Balochistan Assembly was briefed on the matter and elected representatives did not raise any objections.
Moreover, the order said, the agreement met environmental requirements and Barrick Gold Corporation assured that labour rights would be considered during the implementation of the project.
Barrick Gold Corporation assured that laws for wages would be abided by and most of the labour force would be recruited from Pakistan, the order said.
The court was further told that the project would be used for investing in social initiatives and skill development schemes would also be launched under it, the order added.
There was nothing illegal in the new Reko Diq agreement, the court concluded, adding that it was also not in violation of its 2013 judgement.
‘Historic decision’
Balochistan Chief Minister Mir Abdul Quddus Bizenjo welcomed the SC’s decision, terming it “historic”.
He said it was an acknowledgement of the Balochistan government’s “determination and efforts for the economic independence of the province and protection of its resources”.
Reko Diq deal
The original agreement for the Reko Diq mining project was signed in 2006, and it set aside a share of 37.5pc to Canada’s Barrick Gold and Chile’s Antofagasta each while the Balochistan government received a 25pc stake.
The two international firms were part of the consortium Tethyan Copper company and had found vast gold and copper deposits at Reko Diq in Balochistan.
But the hugely lucrative open-pit mine project came to a standstill in 2011 after the local government refused to renew Tethyan Copper’s lease, and in 2013 Supreme Court declared it invalid.
In 2019, the World Bank’s arbitration tribunal committee imposed a penalty on Pakistan for unlawful denial of mining.
However, in March, the federal and Balochistan governments reached an agreement with two international firms — Antofagasta PLC and Barrick Gold Corporation — on a framework to reconstitute the Reko Diq project that allowed Antofagasta to make an exit.
The reconstituted project, which will excavate gold and copper reserves in Balochistan, saved Pakistan from an $11 billion penalty in the Reko Diq case.
Under the new agreement, Barrick decided to become a 50 per cent partner with the governments of Pakistan and Balochistan and three state-owned entities in the project, while the Chilean firm exited the contract in exchange for $900 million by Pakistani shareholders.
Balochistan government holds a 25pc stake in the project under the new pact and the rest of the 25pc shareholding is controlled equally (8.33pc) by the three state-owned enterprises.
On October 18, President Dr Arif Alvi moved a reference seeking the apex court’s opinion on the proposed reconstitution of Reko Diq project in Balochistan and interpretation on whether its 2013 judgement in the case prevented the federal and provincial governments from entering into the implementation agreement and the constitutionality of the proposed Foreign Investment (Protection and Promotion) Bill 2022.