Mining firm moves Virgin Islands court for enforcement of Reko Diq award against Pakistan [#24]

The project is being given to China in the near future.

This is good news for Baluchistan and Pakistan :)
 
Zardari can certainly make use of some more dough!! :Zardari
 
During the Mushi era, he made contracts with some Australian mining companies for peanuts. Thank God that some sense has prevailed and the new Baluchistan provincial government has cancelled these contracts.

Yet another feather in the cap of phattu commando.
 
I dont know why the deal was given to foreign countries in the first place. Very shady.

They take our raw copper, and process it somewhere else to make huge profits, while we get a tiny share for selling the raw materials.

Then people of Pakistan are being taken on a ride
 
10% of $1trillion is a hell of a lot of money!
 
There are so many outside forces trying to destabalize pakistan nd separate balochistan; this will certainly intensifty their efforts. Inshallah they all will fail and we can make full use of this reward.
 
unfortunately this may not happen i mean wont benefit pakistan.
foreigners powers and baluch corrupt leaders who are on payroll of enemies of pakistan will brain wash their jahil people and tell them that all these gold belong to baluchies and the punjabis and punjabi army will steal your gold! all balochi should revolt against this sinful act.
 
namak said:
To effectively use the reserves, the province must be at peace. No Baloch separatists, and no (purported or actual) Taliban influences.

I dont see that happening any time soon.

An interesting article:

http://rupeenews.com/2009/05/11/reko-diq-mystery-why-americans-are-after-balochistan/

:)) There is no Taliban problem niether is theer any real Sepratist problem, you can practically use your hands and bare feet to count how many 'seperatists' there are.

The only problem is foreign backed de0stabalization (by which i mean small minor blasts rocking some places) other then that there is no problem.

Though the propaganda will probably intensify after this....with everything thats in Balochistan it is literally like an underground Aladins cave!
 
To effectively use the reserves, the province must be at peace. No Baloch separatists, and no (purported or actual) Taliban influences.
You ignore the Sardars who control the lands and people. For them it is their's.
I am going by some article (posted here 1-2 years ago) that they demand and paid a lot money, for let's say the gas, but not much seem to go to their people, education or development
 
What a great development for Balochistan and the Balochi people. Just like the discovery of natural gas in Sui brought such wonderful improvements and modern levels of health care and education in the lives of ordinary Balochis, the discovery of gold will I have no doubt do the same.

::J
 
d0gers said:
What a great development for Balochistan and the Balochi people. Just like the discovery of natural gas in Sui brought such wonderful improvements and modern levels of health care and education in the lives of ordinary Balochis, the discovery of gold will I have no doubt do the same.

::J

When was the Sui gas found?
 
slix10 said:
It's a $100 billion , doesn't sound like that much :p

enough to make Zardari the richest man on the planet.

zardari_mental.jpg
 
ISLAMABAD: Pakistan is actively engaged in negotiations with parties involved in a dispute over the $5.97 billion award against the country in the Reko Diq litigation.

The government is fully aware and defending the country’s interests, a source privy to the latest developments told Dawn on condition of anonymity.

The reaction came in response to a report issued by Law360 — a website that deals with news reports and analyses about legal issues, including litigation filing, case settlement, verdict, regulation, enforcement, legislation, corporate deals, etc.

The website claimed that the Australian copper mining joint venture has been given the green light to try to collect 50 per cent of the massive July 2019 $5.97 billion arbitral award against Pakistan following a dispute over a rejected mining project, so long as it agrees to repay those funds if the award is annulled.

ARTICLE CONTINUES AFTER AD

According to Law360, the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) committee issued the order on Oct 30, saying Pakistan had not obtained an irrevocable bank guarantee or letter of credit for 25pc of the award — a condition laid out by the committee in September for keeping the stay of enforcement in place.

The ICSID tribunal was seized with a dispute between Pakistan and Tethyan Copper Company (TCC) which had claimed $8.5bn for rejecting latter’s application by the Mining Authority of Balochistan for the multimillion dollar mining lease in the province in 2011.

Earlier, Pakistan had taken the plea before the tribunal that the agreement/mining licence at Reko Diq was procured through corrupt means and therefore, the claimant (TCC) could not ask for damages.

However, both the parties — Pakistan and TCC — had met in London in Oct last year and had agreed to remain open for a negotiated out-of-court settlement of the dispute, the sources said, adding that the parties were still engaged with each other and hopeful that the matter would be resolved successfully soon.

The committee, Law360 claimed, terminated the stay of enforcement for 50pc of the $5.9 billion award, which the TCC won last year.

Earlier, Pakistan had welcomed a statement made by William Hayes, the chairman of the board of directors of TCC, in which he had expressed a willingness to work towards a negotiated settlement.

Mr Hayes had stated in his statement that the company remained willing to discuss the potential for a negotiated settlement with Pakistan and will continue to protect their commercial interests and legal rights until the conclusion of this dispute.

Then Pakistan had taken the stand that it had considered the July 12, 2019 press release made by Antofogasta Plc and the statement of William Hayes.

“The government of Pakistan welcomes this approach to work towards a mutually beneficial solution that works for both sides,” adding that it was a responsible state and the government of Pakistan always takes its international legal obligations most seriously.

Pakistan had also stated that the mineral resources in Reko Diq were the collective resource of the people of Balochistan and Pakistan, adding that Pakistan was keen for the development of this resource to ensure that the development needs of some of the poorest people on the planet were addressed.

The TCC is a 50-50 joint venture of Barrick Gold Corporation of Australia and Antofagasta PLC of Chile whereas the Reko Diq district in the southwest of Baluchistan is famed for its mineral wealth, including gold and copper.

Published in Dawn, November 12th, 2020
 
ISLAMABAD: Pakistan is actively engaged in negotiations with parties involved in a dispute over the $5.97 billion award against the country in the Reko Diq litigation.

The government is fully aware and defending the country’s interests, a source privy to the latest developments told Dawn on condition of anonymity.

The reaction came in response to a report issued by Law360 — a website that deals with news reports and analyses about legal issues, including litigation filing, case settlement, verdict, regulation, enforcement, legislation, corporate deals, etc.

The website claimed that the Australian copper mining joint venture has been given the green light to try to collect 50 per cent of the massive July 2019 $5.97 billion arbitral award against Pakistan following a dispute over a rejected mining project, so long as it agrees to repay those funds if the award is annulled.

ARTICLE CONTINUES AFTER AD

According to Law360, the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) committee issued the order on Oct 30, saying Pakistan had not obtained an irrevocable bank guarantee or letter of credit for 25pc of the award — a condition laid out by the committee in September for keeping the stay of enforcement in place.

The ICSID tribunal was seized with a dispute between Pakistan and Tethyan Copper Company (TCC) which had claimed $8.5bn for rejecting latter’s application by the Mining Authority of Balochistan for the multimillion dollar mining lease in the province in 2011.

Earlier, Pakistan had taken the plea before the tribunal that the agreement/mining licence at Reko Diq was procured through corrupt means and therefore, the claimant (TCC) could not ask for damages.

However, both the parties — Pakistan and TCC — had met in London in Oct last year and had agreed to remain open for a negotiated out-of-court settlement of the dispute, the sources said, adding that the parties were still engaged with each other and hopeful that the matter would be resolved successfully soon.

The committee, Law360 claimed, terminated the stay of enforcement for 50pc of the $5.9 billion award, which the TCC won last year.

Earlier, Pakistan had welcomed a statement made by William Hayes, the chairman of the board of directors of TCC, in which he had expressed a willingness to work towards a negotiated settlement.

Mr Hayes had stated in his statement that the company remained willing to discuss the potential for a negotiated settlement with Pakistan and will continue to protect their commercial interests and legal rights until the conclusion of this dispute.

Then Pakistan had taken the stand that it had considered the July 12, 2019 press release made by Antofogasta Plc and the statement of William Hayes.

“The government of Pakistan welcomes this approach to work towards a mutually beneficial solution that works for both sides,” adding that it was a responsible state and the government of Pakistan always takes its international legal obligations most seriously.

Pakistan had also stated that the mineral resources in Reko Diq were the collective resource of the people of Balochistan and Pakistan, adding that Pakistan was keen for the development of this resource to ensure that the development needs of some of the poorest people on the planet were addressed.

The TCC is a 50-50 joint venture of Barrick Gold Corporation of Australia and Antofagasta PLC of Chile whereas the Reko Diq district in the southwest of Baluchistan is famed for its mineral wealth, including gold and copper.

Published in Dawn, November 12th, 2020

The award is stupid and too high. The whole thing was corrupt and now there is no incentive for them to accept a compromise on the deal. The PK govt should reoffer the licences and security to avoid this crippling award. Another legacy of Kanna CJP
 
Mining firm moves Virgin Islands court for enforcement of Reko Diq award against Pakistan

The Tethyan Cooper Company (TCC) has approached the High Court of Justice in the British Virgin Islands for the enforcement of the $5.97 billion award against Pakistan by the International Centre for Settlement of Investment Disputes (ICSID) in the Reko Diq case.

The office of the Attorney General for Pakistan, however, has assured that Pakistan is vigorously contesting these proceedings using all available legal resources. The government is also engaged to settle the matter amicably.

On November 20, the company had moved the high court for the enforcement of the award which includes attachment of the assets belonging to the Pakistan International Airlines Investment Ltd (PIAIL) — a company which is also incorporated in the British Virgin Islands.

On December 16, the high court had granted a stay order ex-parte without hearing Pakistan, but the government said it will contest the case when it is taken up again on January 7, 2021.

"Without prejudice to such engagements, Pakistan has reiterated that the government will vigorously pursue proceedings initiated by the company in any jurisdiction and the government reaffirms its commitment to protecting national assets wherever they may be located," a statement by the attorney general's office said.

The TCC is a 50-50 joint venture of Barrick Gold Corporation of Australia and Antofagasta PLC of Chile whereas the Reko Diq district in southwest Balochistan is famed for its mineral wealth, including gold and copper.

Read more:

Reko Diq dispute

The ICSID tribunal had taken up the dispute between Pakistan and the TCC after the latter claimed $8.5bn when the mining authority of Balochistan rejected its application for a multi-million dollar mining lease in the province in 2011.

According to details available on Tethyan’s website, the Reko Diq Mining Project was to build and operate a world class copper-gold open-pit mine at a cost of about $3.3 billion. The company says its 1998 agreement with the Balochistan government entitled it to the mining lease, subject only to routine government requirements.

The project stalled in November 2011 after the application was rejected. Pakistani officials say the mining lease was terminated by the government because it was secured in a non-transparent manner.

By then, the company had invested $220 million in Reko Diq. The Australian mining company sought help from the World Bank arbitration tribunal in 2012, and it ruled against Pakistan in 2017, rejecting an earlier decision by the Supreme Court.

The tribunal opted to use a formula for calculating damages for the cancelled lease based on the assumed profits Tethyan might have earned from the mine over 56 years. In July 2019, the tribunal slapped a whopping $5.97 billion award against Pakistan for denying the mining lease to the Aus*tralian company.

The fine, of nearly $6 billion, including the damages award and interest, is equal to about two per cent of Pakistan’s GDP.

Immediately thereafter, the TCC had commenced proceedings for enforcement of the award. In November 2019, Pakistan had challenged the award and initiated proceedings seeking its annulment.

In March this year, the AGP office announced that it had filed a request on November 8, 2019 for the annulment of the award rendered by the ICSID on July 12, 2019.

Alongside the plea for annulment, ******tan had also requested a pro*visional stay on the enforcement of the award issued against the country on November 18, 2019.

Pakistan was granted the provisional stay upon initiating annulment proceedings after which a hearing to confirm the stay order took place over ‘video link’ in April this year. On September 16, 2020, the tribunal finally ruled in favour of Pakistan, confirming the stay on the enforcement of the award.

The ICSID is still considering Pakistan’s appeal against the penalty over its decision to cancel the Reko Diq mining lease for the TTC and a final hearing will take place in May 2021.
https://www.dawn.com/news/1597596/m...nforcement-of-reko-diq-award-against-pakistan
 
LONDON: The High Court of Justice in the British Virgin Island (BVI) will be hearing case pertaining to the enforcement of the $6 billion award in the Reko Diq matter on January 18.

In a brief court proceeding on Thursday, Justice Gerhard Wallbank of the BVI High Court of Justice fixed the next hearing for January 18 wherein Pakistani counsel will be given half a day to present arguments in the case first time since the court froze Pakistan International Airlines (PIA) assets registered in the BVI jurisdiction.

The injunction on the PIA assets will remain in place till January 19, a source from Pakistan's legal team told Geo.tv. The receivership also stays in place till a decision is made at the next hearing.

Case background
In July 2019, the International Center for Settlement of Investment Disputes (ICSID) slapped a massive $5.976 billion award against Pakistan for revoking Tethyan Copper Company's (TCC) mining contract at Reko Diq in Balochistan.

Former chief justice of Pakistan Iftikhar Muhammad Chaudhry's verdict in the Reko Diq case had set off the series of events that led to the ICSID decision after nearly seven years of litigation.

In September 2020, Pakistan won a stay on the enforcement of the award and ICSID said the stay shall continue on a conditional basis. The arbitrator directed Pakistan to provide an “unconditional and irrevocable” bank guarantee or the letter of credit (LC) for 25% of the award, plus accrued interest as of the date of the decision.

Pakistan, however, missed the deadline and did not deposit a 25% bank guarantee.

In November 2020, the TCC approached the BVI High Court of Justice for enforcement of the award. On December 16, the high court had, through an ex parte order, attached assets belonging to the Pakistan International Airlines Investment Limited (PIAIL) including Roosevelt Hotel in New York, Scribe Hotel in Paris, and froze 40% of PIA's interest in Minhal Incorporated.
 
ISLAMABAD:The High Court of Justice in the British Virgin Islands (BVI) on Tuesday decided the Pakistan International Airlines would retain its two assets — Roosevelt Hotel in New York and Scribe Hotel in Central Paris — retracting its earlier order to attach these properties with the enforcement of Reko Diq penalty on the request of the Tethyan Copper Company (TCC).

BVI High Court’s Justice Gerhard Wallbank, while passing the order on December 10, 2020, had attached the assets belonging to the PIA Investment Limited, including the company’s interests in the two hotels.

“A short while ago, [the] judgment was announced by British Virgin Island High Court. Great legal victory for PIA and Pakistan,” read a statement issued by the Attorney General for Pakistan's (AGP) office. “The order was passed earlier on the request of TCC which was seeking enforcement of Reko Diq award,” it added.

“All orders passed against PIA earlier are now recalled by the Court. Receiver removed from Roosevelt hotel, NY and Scribe hotel, Paris. Cost of litigation also awarded.”

Prime Minister Imran Khan has appreciated the efforts of the international disputes unit and the office of the AGP.

On November 20 last year, the TCC had sought attachment of assets for the enforcement of the $6 billion award that the International Centre for Settlement of Investment Disputes (ICSID) slapped on Pakistan on July 12, 2019, for revoking a mining contract in Reko Diq, Balochistan.

Despite the withdrawal of attachment orders by the BVI court, the $6 billion award against Pakistan stands intact.

The ICSID stayed the enforcement of the $6b penalty and on September 17 and issued a 70-page order which said the stay would continue on a conditional basis.

The arbitrator ordered Pakistan to provide an “unconditional and irrevocable” bank guarantee or the letter of credit for 25% of the award, plus accrued interest as of the date of the decision.

The guarantee or letter of credit was to come from a reputable international bank based outside of Pakistan, which was pledged in favour of the claimant -- the TCC -- and to be released on the order of the ICSID.

The ICSID also held that if Islamabad could not furnish the security and undertaking in terms as set out within 30 days after notification of the decision, the stay of enforcement in the amount of 50% of the award, plus the accrued interest as of the date of the decision would be lifted.

However, Pakistan missed the deadline and did not deposit 25% bank guarantee.
 
ISLAMABAD:The High Court of Justice in the British Virgin Islands (BVI) on Tuesday decided the Pakistan International Airlines would retain its two assets — Roosevelt Hotel in New York and Scribe Hotel in Central Paris — retracting its earlier order to attach these properties with the enforcement of Reko Diq penalty on the request of the Tethyan Copper Company (TCC).

BVI High Court’s Justice Gerhard Wallbank, while passing the order on December 10, 2020, had attached the assets belonging to the PIA Investment Limited, including the company’s interests in the two hotels.

“A short while ago, [the] judgment was announced by British Virgin Island High Court. Great legal victory for PIA and Pakistan,” read a statement issued by the Attorney General for Pakistan's (AGP) office. “The order was passed earlier on the request of TCC which was seeking enforcement of Reko Diq award,” it added.

“All orders passed against PIA earlier are now recalled by the Court. Receiver removed from Roosevelt hotel, NY and Scribe hotel, Paris. Cost of litigation also awarded.”

Prime Minister Imran Khan has appreciated the efforts of the international disputes unit and the office of the AGP.

On November 20 last year, the TCC had sought attachment of assets for the enforcement of the $6 billion award that the International Centre for Settlement of Investment Disputes (ICSID) slapped on Pakistan on July 12, 2019, for revoking a mining contract in Reko Diq, Balochistan.

Despite the withdrawal of attachment orders by the BVI court, the $6 billion award against Pakistan stands intact.

The ICSID stayed the enforcement of the $6b penalty and on September 17 and issued a 70-page order which said the stay would continue on a conditional basis.

The arbitrator ordered Pakistan to provide an “unconditional and irrevocable” bank guarantee or the letter of credit for 25% of the award, plus accrued interest as of the date of the decision.

The guarantee or letter of credit was to come from a reputable international bank based outside of Pakistan, which was pledged in favour of the claimant -- the TCC -- and to be released on the order of the ICSID.

The ICSID also held that if Islamabad could not furnish the security and undertaking in terms as set out within 30 days after notification of the decision, the stay of enforcement in the amount of 50% of the award, plus the accrued interest as of the date of the decision would be lifted.

However, Pakistan missed the deadline and did not deposit 25% bank guarantee.
[MENTION=131701]Mamoon[/MENTION] tell us why we lost these cases. Surely these competent people in power would have protected the interests of PK and not lined their own pockets.
 
Despite the rejection of its plea on corruption charges, Pakistan has various options to deal with the Reko Diq case, wherein the country is facing a massive penalty of $6 billion.

A UK high court on July 6 rejected Pakistan’s plea to raise corruption charges in the International Chamber of Commerce (ICC), which is hearing the Tethyan Copper Company’s (TCC) case against Pakistan.

A senior government official told The Express Tribune that Pakistan was considering various options, including challenging the UK high court’s decision in a court of appeal.

“We will approach a higher forum against UK high court decision as we want to place new evidence of corruption against the complainant company, the TCC, in the Reko Diq case,” he added.

Though the TCC managed to achieve a huge penalty on Pakistan, it is unable to find a single penny.

The complainant company approached various foreign courts including the British Virgin Islands BVI high court for the enforcement of the award. However, the BVI court has already rejected the TCC’s plea.

It has already been reported that a series of efforts are underway for an out-of-court settlement.

Lawyers, who have expertise in international law, believe that the TCC has no viable option except to accept an out-of-court settlement deal.

They say that enforcement proceedings regarding $6 billion award is a time-consuming process and not the best option for the TCC when the country has very limited assets abroad.

The TCC failed to attach the PIA’s assets abroad.

It is learnt that Pakistan has so far faced Rs6 billion litigation cost since 2012.

However, it is also a fact that the present legal team led by Attorney General for Pakistan (AGP) Khalid Jawed Khan is successfully evolving a legal strategy in all matters including the Reko Diq case before the International forum.

It has also been learnt that raising the corruption issue was necessary for many reasons. Not only did it actually happen, but also dragged the case on merits for long enough.

Even if this ground is rejected, Pakistan will suffer no extra loss and will drag in appeal.

Now the case will proceed before the ICC on merits in October.

Various factors are responsible for spoiling the Reko Diq case.

First, the Supreme Court should have avoided intervening into the matter.

Secondly, to secure strategic interest, the security establishment was unable to realise the financial implications of striking down a gold-mining deal with the TCC in the case.

Earlier, the International Centre for Settlement of Investment Disputes (ICSID) committee also concluded proceedings initiated by Pakistan for the annulment of $6 billion award in the case.

Law Minister Dr Farogh Naseem also took part in the annulment proceedings through video link.

Similarly, the APG also presented his submissions. The decision on Pakistan's annulment plea is still awaited. Sources told The Express Tribune that Pakistan has raised several grounds to invoke annulment proceedings.

Legal experts say Pakistan’s chances of having its $6 billion penalty in the Reko Diq case annulled have received a boost after the ICSID committee set aside a €128m arbitral award slapped on Spain.

https://tribune.com.pk/story/2309792/pakistan-mulls-options-in-reko-diq-case
 
<blockquote class="twitter-tweet" data-partner="tweetdeck"><p lang="en" dir="ltr">In line with my govt's vision for uplift of smaller provinces, I have decided our fed govt will bear all the financial burden for Reko Diq & it's development on behalf of Govt of Balochistan. This will help usher in an era of prosperity for the people & province of Balochistan.</p>— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1476252852968472581?ref_src=twsrc%5Etfw">December 29, 2021</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
 
An out-of-court settlement of the Reko Diq project in the Chagai district of Balochistan has been finalised and an official announcement in this regard will likely be made in the evening, sources familiar with the development said on Sunday.

Pakistan’s government has actively engaged with Australia's Tethyan Copper Company (TCC) to reach a settlement as the country was threatened with facing a penalty of $6 billion due to its decision to deny a mining lease to TCC.

The Attorney General for Pakistan (AGP) office, especially International Disputes Unit Head Additional Attorney-General (AAG) Ahmed Irfan Aslam, mainly negotiated the Reko Diq deal. AAG Ahmed Irfan had earlier successfully negotiated the deal in the Karkey case, in which Pakistan faced a billion-dollar fine.

According to sources, a new agreement was signed by representatives of the federal government and Balochistan with a delegation of Barrick Gold led by Chief Executive Dr Mark Bristow. As per the terms of the new agreement, the Reko Diq project shall be revived and developed by Barrick Gold in partnership with Pakistani entities.

50 per cent of the new project’s shares will be owned by Barrick Gold, while the remaining shares shall be owned by Pakistan, divided equally between the federal government and the provincial government of Balochistan.

The federal government’s shares of 25% shall be divided equally amongst three state-owned entities (SOE), namely Oil & Gas Development Corporation Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Pakistan Limited (GHPL).

Balochistan’s shares shall be held by a company wholly-owned and controlled by the Government of Balochistan.

Earlier, the lawmakers of Balochistan expressed their satisfaction with the terms of the proposed deal after senior federal government officials addressed concerns on the out-of-court settlement for the Reko Diq project.

A senior official in the AGP’s office, along with additional secretaries of petroleum and finance, provided an eight-hour briefing to the members of the Balochistan Assembly in December 2021.

Balochistan’s lawmakers were informed that the most daunting challenge was to clear the liability of the $6 billion fine awarded by the International Centre for Settlement of Investment Dispute (ICSID) on account of scrapping the lease mining agreement with TCC.

In order to clear the liability, a deal was negotiated wherein there was an opportunity that TCC’s shareholding company, Barrick Gold, might resume the project under different terms. Likewise, Balochistan’s profit share would be 25%, which was equal to the share owned by the federal government.

Balochistan’s lawmakers were further informed that the federal government would bear the burden of the province's share of the cost of the project.

Prime Minister Imran Khan had already announced that in line with his government's vision for the uplift of smaller provinces, he had decided that the federal government would bear the financial burden for Reko Diq and its development on behalf of the Balochistan government.

“This will help usher in an era of prosperity for the people and the province of Balochistan,” the premier had added.

The officials also informed the lawmakers that mining companies would ensure a 5 per cent royalty in accordance with the provincial law. The company would also spend on education, health and water in the province in order to fulfil the corporate social responsibilities.

Sources revealed to The Express Tribune that the project’s development would result in an investment of approximately $10 billion in Balochistan, including $1 billion which would be invested in social uplift projects such as roads, schools, hospitals, and the creation of technical training institute for mining. The investment is also said to result in the creation of over 8,000 jobs.

“This project shall make Balochistan the largest recipient of foreign direct investment in Pakistan and the Reko Diq project shall be one of the largest copper and gold mining projects in the world”, sources added.

In order to ensure optimal utilisation of the nation’s mineral wealth, the government is considering setting up a smelter.

The agreement was reached after several rounds of negotiations over the last three years.

In August 2019, the premier had set up a committee to steer the negotiations, with an aim for early development of the mines. In this effort, the federal and provincial governments were assisted by international advisors including the law firm White and Case and investment bank, Lazard.

To ensure the deal’s compliance with the law, the government is to submit the matter before parliament and the Supreme Court.

Read More: CM denies secret deal on Reko Diq gold project

The Balochistan cabinet on March 19, approved the proposed agreement and settlement regarding the Reko Diq project. The approval was given during a special cabinet meeting chaired by Balochistan Chief Minister Abdul Quddus Bizenjo.

$6b penalty

In July 2019, an international arbitration tribunal of the ICSID struck a penalty of $6 billion on Pakistan for its 2011 decision to deny the mining lease to the TCC -- a 50-50 joint venture of Barrick Gold Corporation of Australia and Antofagasta PLC of Chile.

The tribunal, chaired by Germany's Klaus Sachs and Bulgarian arbitrator Stanimir Alexandrov and UK's Lord Hoffmann, had ordered Pakistan to pay over $4 billion in damages to TCC in addition to $1.7 billion in pre-award interest.

The tribunal had found that Pakistan had unlawfully denied the TCC a lease to mine copper and gold deposits at the Reko Diq mine. It had held that the state had committed an unlawful expropriation under the Australia-Pakistan bilateral investment treaty.

Later, the TCC had approached courts in five different countries for the enforcement of the penalty imposed on Pakistan.

Reko Diq Project

On July 29, 1993, BHP Minerals (BHP) and the Balochistan Development Authority (BDA) had signed the Chagai Hills Exploration Joint Venture Agreement (CHEJVA).

Subsequently, on Nov 23, 2006, the TCC had bought BHP’s interests in CHEJVA for US$ 240 million and became a party to the CHEJVA pursuant to a Novation Agreement with BHP and the Government of Balochistan.

On August 26, 2011, the TCC had submitted its feasibility report and an application for mining lease which was rejected by the Licensing Authority on November 15, 2011.

On November 6, 2011, a petition was filed before the Supreme Court asking the top court to order the Balochistan government to refrain from issuing a mining license in an arbitrary and unlawful manner. On January 6, 2013, the Supreme Court held CHEJVA to be void ab initio.

On December 12, 2011, the TCC had instituted proceedings before the ICSID for alleged violations by Pakistan of Australia-Pakistan BIT, 1997; and, before ICC for alleged breach by the Balochistan government of contractual obligations under CHEJVA. The ICC Tribunal had stayed its proceedings in deference to the ICSID proceedings.

On February 12, 2016, the Tribunal had issued a draft decision on jurisdiction and liability and held that (i) it has jurisdiction over TCC’s claims; (ii) TCC had made an investment in Pakistan; and, (iii) Pakistan has expropriated TCC’s investment in Pakistan and breached its BIT obligations.

On July 12, 2019, the ICSID Tribunal had given an award of 5.894 billion plus interest of USD 700,000 per day in damages against Pakistan to the TCC. As of 1 March 2022, the award stands at $6.5billion.

Shortly thereafter, the TCC initiated proceedings for the enforcement of the award in several jurisdictions, including, Australia, the US, and UK (British Virgin Islands).

The ICC also resumed proceedings and was expected to give an additional award against the government of Balochistan. Contemporaneously, Pakistan challenged the ICSID Award by initiating proceedings before ICSID for the annulment of the award. All of the legal proceedings shall now be withdrawn permanently by both TCC and Pakistan.

Express Tribune
 
<blockquote class="twitter-tweet" data-partner="tweetdeck"><p lang="en" dir="ltr">I congratulate the nation & ppl of Balochistan on successful agreement with Barrick Gold for development of RekoDiq mine after 10 years of legal battles & negotiations. Penalty of approx $ 11 bn is off set, $10 bn will be invested in Balochistan creating 8000 new jobs.</p>— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1505490683204939782?ref_src=twsrc%5Etfw">March 20, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
 
<blockquote class="twitter-tweet" data-partner="tweetdeck"><p lang="en" dir="ltr">RD will potentially be the largest gold & copper mine in the world. It will liberate us from crippling debt & usher in a new era of development & prosperity.</p>— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1505490685973176326?ref_src=twsrc%5Etfw">March 20, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
 
This is a massive win for a developing country like Pakistan. There was no way Pakistan would have been able to pay off such a large penalty with interest given poor administration and losing of case by previous administrations. I hope this bring much needed employment locally in Balochistan.
 
<blockquote class="twitter-tweet" data-partner="tweetdeck"><p lang="en" dir="ltr">RD will potentially be the largest gold & copper mine in the world. It will liberate us from crippling debt & usher in a new era of development & prosperity.</p>— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1505490685973176326?ref_src=twsrc%5Etfw">March 20, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

What an incredible effort and win by IK and his team. The damages initially awarded were close to our IMF loan. Just imagine if the mafia were in power and what they would have done. That is the difference between a patriot and a traitors.
 
<blockquote class="twitter-tweet" data-partner="tweetdeck"><p lang="en" dir="ltr">RD will potentially be the largest gold & copper mine in the world. It will liberate us from crippling debt & usher in a new era of development & prosperity.</p>— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1505490685973176326?ref_src=twsrc%5Etfw">March 20, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

good development for pakistan to sort out this mess, however the hyperbole dont help, one ore mine is not gonna liberate Pakistan from its debt burden, production could take 5 to start and 10 years to reach full pace, and by then whilst exports of the size hoped for would definitely help the current account defecit, im guessing by up to 1% to 2% of GDP if we are being optimistic, it still wouldn't sort out Pakistan's structural economic imbalances.
 
good development for pakistan to sort out this mess, however the hyperbole dont help, one ore mine is not gonna liberate Pakistan from its debt burden, production could take 5 to start and 10 years to reach full pace, and by then whilst exports of the size hoped for would definitely help the current account defecit, im guessing by up to 1% to 2% of GDP if we are being optimistic, it still wouldn't sort out Pakistan's structural economic imbalances.

Maybe not, but if this company invests we could have others investing and then it does start to change the imbalances.
 
good development for pakistan to sort out this mess, however the hyperbole dont help, one ore mine is not gonna liberate Pakistan from its debt burden, production could take 5 to start and 10 years to reach full pace, and by then whilst exports of the size hoped for would definitely help the current account defecit, im guessing by up to 1% to 2% of GDP if we are being optimistic, it still wouldn't sort out Pakistan's structural economic imbalances.

Probably right.
But we gotta start from somewhere.
Unfortunately there is no magic wand that could help us write off the 75 years worth of corruption and looting that has pushed the country under $118 Billion debt.
 
So IK has helped with not only get rid of a $11bn fine, he has brought a $10bn investment. There is a 50/50 split in revenue. Kaptaan you have destroyed PK by this $21bn turn around. If you were competent you would be hiring young models to launder money in their bags and helping the national TT industry by using names of Chaprasis by laundering 16bn.
 
So IK has helped with not only get rid of a $11bn fine, he has brought a $10bn investment. There is a 50/50 split in revenue. Kaptaan you have destroyed PK by this $21bn turn around. If you were competent you would be hiring young models to launder money in their bags and helping the national TT industry by using names of Chaprasis by laundering 16bn.

Is it 50/50 or is it 70/30?
 
Is it 50/50 or is it 70/30?

50/50 with company, and then with our 50% national and provincial govt split it 50/50. The previous deal was awful for PK govt. We were going to get next to nothing. This is an amazing turn around. Well Done Kaptaan and your team. It's a shame your aren't good at TTs or using young models to launder
 
Balochistan Chief Minister Mir Abdul Qudoos Bizenjo, while defending a recently signed agreement on the Reko Diq copper and gold mining project with a Canadian company, has disclosed that a Saudi Arabian firm would set up a refinery in Gwadar to assess the quantity of minerals extracted from the site.

“I have taken all political leaders, parties and public representatives into confidence before signing the Reko Diq project, which will prove a gateway for foreign investment in Balochistan as [Canadian firm] Barrick Gold Corporation will invest $10 billion,” he said during an interaction with senior journalists and newspapers editors at Chief Minister House on Friday night.

He said the agreement clearly mentioned it “would be cancelled if the [Canadian] company failed to start work within three years at the site allotted for exploration and mining.”

Mr Bizenjo said that despite various hurdles and difficulties, it was the best possible agreement. “Five months were crucial and very difficult in which there has been a fear of the governor’s rule in the province,” he said, adding that all political leaders have appreciated our efforts and said that we had made a big contribution to the province.


He said that under the new agreement, Balochistan’s share in the project would be 25 per cent without any investment by the province. Other financial benefits, including royalty taxes, were also part of the agreement.

He said that Barrick Gold would pay a royalty to Balochistan immediately while the company would spend Rs40 billion to develop the area under social responsibility.

He claimed that former chief minister Jamal Kamal Khan was dealing alone with the authorities concerned to restart the Reko Diq project without taking anyone on board, including even the chief secretary, finance secretary and other officials.

Mr Bizenjo said that under the Reko Diq project, an area of 100 square kilometres had been allotted for 100 years to Barrick Gold, while the government would be free to approach other companies for other areas.

He also talked at length about the political situation and on other issues, including a no-confidence motion against him. He said he was not worried about such rumours and added that if someone had the support of the members, he should file a motion in the assembly.

Published in Dawn, March 27th, 2022
 
Reko Diq investor wants deal vetted by parliament, SC
Barrick Gold CEO vows huge investment in community development in Balochistan

ISLAMABAD:
Barrick Gold Corporation, the Canada-based mining group, has asked the government to get the Reko Diq gold and copper deal stamped by parliament and the Supreme Court for long-term sustainability of the company’s investment in the project.

Mark Bristow, president and chief executive officer (CEO) of Barrick Gold, said that the company was still negotiating the legal framework with the present government and wanted legislation on this deal.

“We want partnership framework conforms to legislation,” Bristow told a press conference in Islamabad. He said they wanted transparency in the execution of the project and that parliament and the Supreme Court vet this deal.

Under an agreement, Barrick Gold would operate the Reko Diq mine with 50% share, while the Balochistan government would own the 25% share, and state-owned enterprises – Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL) and Government Holdings Private Limited (GHPL) – would have the remaining 25%.

Previously, Pakistan and foreign companies, including Barrick Gold, had fought a legal battle in the international court of arbitration over the Reko Diq mining issue. Later, both sides entered into an out-of-court settlement during the tenure of the previous government.

As a result, a Chile-based firm exited the deal after the payment of $900 million. However, Barrick decided to become a 50% partner of Reko Diq mining project. Bristow said that the company wanted long-term relationship with the state of Pakistan.

He termed Pakistan a very attractive “destination for investment” but stressed that legal protection was the key to big foreign investment coming to Pakistan. Referring to legal battle, Bristow said that it did not benefit any party.

“We had been fighting for long and decided to find out a solution to execute Reko Diq project as the fight was not good for any party,” he said, adding that the project could attract additional investment in the region.

Bristow revealed in the press conference that the Reko Diq project would attract a total of $10 billion investment in two phases. “There will be $7 billion minimum investment in the first phase and $3 billion in the second phase,” he explained.

Bristow ruled out initial public offering (IPO) to generate funds. “Barrick Gold has strong balance sheet, so we do not need to raise money and are able to support investment,” he said.

When asked further about the possibility of setting up a refinery in Pakistan to process raw material from the project, chief of the Canada-based mining group said that such a proposal was not feasible at the present stage.

Responding to another question pertaining to the law and order situation in Balochistan, Bristow played down any such worries, saying that Barrick Gold had worked in conflict areas and that it had its own plan to execute the Reko Diq project.

“We will invest in the communities, in social responsibility, and will offer 100% jobs to the local people,” he said, adding that the Pakistani students would be offered scholarships to study in the top universities of the world.

Training of the local people by import of technology would also be the objective, Bristow said. He assured that the company would ensure all international standards of the environment. He added that a distillation plant would also be set up.

“The company will work on a three-pronged strategy to give high quality asset to unlock more value for the Pakistani and the Baloch people. It will work on building infrastructure, water security and power in Balochistan.”

Read Sindh, Balochistan receive over 500% more rain than 30-year average in July

Earlier, Bristow held a meeting with Finance Minister Miftah Ismail and shared a clear vision for the Reko Diq copper-gold project. Both sides resolved to develop it into a world-class mine that would create value for the country and its people for multiple generations.

Reko Diq is one of the world’s largest undeveloped copper-gold mine. Earlier this year, an agreement was reached in principle between the federal government, the Balochistan government and Barrick Gold to restart the project, which has been on hold since 2011.

For this purpose, the definitive agreement, underlying the framework agreement, is currently being finalised by teams from the mining group and the government of Pakistan. Once the necessary legalisation steps have been taken, the original feasibility study would be updated.

The process is expected to take two years, after which the construction in the first phase will start. The first production of copper and gold is expected in 2027-28. Both sides agreed that Balochistan would get its due share.

“Balochistan and its people should receive their fair share of the benefits,” Bristow said. “At Barrick, we know that our long-term success depends on sharing the benefits we create equitably with our host governments and communities.”

At Reko Diq, Balochistan’s shareholding will be fully funded by the project and the federal government, allowing the province to reap dividends, royalties and other benefits of its 25% ownership without having to contribute financially to the project’s construction or operation.

“It’s equally important that Balochistan and its people should see these benefits from day one. Even before construction starts, when the legalisation process has been completed we will implement a range of social development programmes,” Bristow said.

These programmes, the company chief said, would be “supported by an upfront commitment to the improvement of healthcare, education, food security and the provision of potable water in a region, where the groundwater has a high saline content”.

Finance Minister Miftah Ismail said that the development of Reko Diq represented the largest foreign direct investment (FDI) in Balochistan and one of the largest in the history of the country.

“Like Barrick, we believe that the future of mining lies in mutually-beneficial partnerships between host countries and world-class mining companies. The Reko Diq agreement exemplifies this philosophy, and also signals to the world that Pakistan is open for business.”

Subject to the updated feasibility study, Reko Diq is envisaged as a conventional open-pit and milling operation, producing a high-quality copper-gold concentrate. It will be constructed in two phases.

The project will start with a plant that will process approximately 40 million tonnes of ore per annum, which could be doubled in five years. With its unique combination of large scale, low strip and good grade, Reko Diq will be a multi-generational mine with a life of at least 40 years.

During peak construction, the project is expected to employ 7,500 people and once in production it will create 4,000 long-term jobs. Barrick’s policy of prioritising local employment and suppliers will have a positive impact on the downstream economy.

Express Tribune
 
The federal government is set to approve the filing of presidential reference in the Supreme Court to get validation of the new Reko Diq project deal.

A senior official confirmed to The Express Tribune that the cabinet would give approval on Friday, regarding the filing of the presidential reference as well as parliamentary approval of the deal on Reko Diq. The matter was added to today's cabinet meeting agenda, he added.

Barrick Gold Corporation, a Canada-based mining group, had asked the government to get the Reko Diq gold and copper deal stamped by the parliament and the Supreme Court for long-term sustainability of the company’s investment in the project.

According to the settlement, 50% of the new project’s shares would be owned by Barrick Gold, while the remaining shares would be owned by Pakistan, divided equally between the Centre and the Balochistan government.

The federal government’s share of 25% will be divided equally among three state-owned entities -- the Oil and Gas Development Corporation Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Pakistan Limited (GHPL).

Interestingly, no private company was included in the project by the Pakistani side despite efforts.

Balochistan’s share shall be held by a company wholly-owned and controlled by the provincial government. As part of the prime minister’s vision for Balochistan, the provincial government’s share of capital and operating expenses for the project shall be borne by the Centre.

The Balochistan government will not incur any expenses in the development of the mines.

In developing the project, nearly $10 billion will be invested in Balochistan, including $1 billion for social uplift projects -- roads, schools, hospitals and the creation of technical training institutes for mining. The investment will create over 8,000 new jobs.

Read Reko Diq investor wants deal vetted by parliament, SC

The project will also make Balochistan the largest recipient of foreign direct investment in the country. To ensure optimal utilisation of the nation’s mineral wealth, the government is also considering setting up a smelter.

Tumultuous past

An agreement was reached after several rounds of negotiations over the last three years.

In August 2019, the prime minister set up a committee to steer the negotiations with the aim of the early development of the mines. In this effort, the federal and provincial governments were assisted by international advisors including a law firm, White & Case, and an investment bank, Lazard.

To ensure the deal is compliant with all the laws, the government will submit the matter before parliament and the Supreme Court. Allegedly, 10 future governments would continue this project wherein $100 billion would be earned.

On July 29, 1993, BHP Minerals (BHP) and the Balochistan Development Authority (BDA) signed the Chagai Hills Exploration Joint Venture Agreement (CHEJVA). Subsequently, on Nov 23, 2006, the TCC bought BHP’s interests in CHEJVA for $240 million. It had become a party to the CHEJVA pursuant to a novation agreement with the BHP and the Balochistan government.

On August 26, 2011, the TCC submitted its feasibility report and an application for a mining lease which was rejected by the licensing authority on November 15, 2011. On November 6, 2011, a petition was filed before the Supreme Court asking the top court to order the Balochistan government to refrain from issuing a mining license in an arbitrary and unlawful manner.

On December 12, 2011, the TCC instituted proceedings before the International Centre for Settlement of Investment Disputes i (ICSID) for alleged violations by Pakistan of Australia-Pakistan BIT, 1997; and, before the International Chamber of Commerce (ICC) for alleged breach by the Balochistan government of contractual obligations under CHEJVA. On January 6, 2013, the Supreme Court held CHEJVA to be void ab initio.

The ICC tribunal had stayed its proceedings in deference to the ICSID proceedings. On February 12, 2016, the tribunal issued a draft decision on jurisdiction and liability and held that (i) it had jurisdiction over TCC’s claims; (ii) TCC had made an investment in Pakistan; and, (iii) Pakistan has expropriated TCC’s investment in Pakistan and breached its BIT obligations.

On July 12, 2019, the ICSID tribunal had given an award of $5.894 billion, plus interest of $700,000 per day in damages against Pakistan to the TCC. At the same time, the London Court of Arbitration also imposed another $4 billion fine on Pakistan.

Shortly thereafter, the TCC initiated proceedings for the enforcement of the award in several jurisdictions, including, Australia, the US, and the UK. The ICC also resumed proceedings and was expected to give an additional award against the Balochistan government.

Contemporaneously, Pakistan challenged the ICSID Award by initiating proceedings before it for the annulment of the award.

Subsequently, Antofagasta decided not to participate in the reconstituted project and withdrew from its claim of $3.9 billion in place of $900 million. All the legal proceedings shall now be withdrawn permanently by both the TCC and Pakistan.

Express Tribune
 
President Dr Arif Alvi, on the advice of Prime Minister Shehbaz Sharif, has accorded approval to the summary for filing reference to the Supreme Court of Pakistan to get validation of the new Reko Diq project deal under Article 186 of the Constitution.

Earlier, the apex committee, headed by Minister for Finance and comprising Tethyan Copper Company Pakistan (Private) Limited shareholders among others, had agreed to a framework for settlement and revival of the Reko Diq project in March 2022.
 
REKO DIQ: PRESIDENT ARIF ALVI FILES REFERENCE IN SUPREME COURT

ISLAMABAD: President Dr. Arif Alvi on Tuesday filed a reference in the Supreme Court to seek its opinion in the Reko Diq case, ARY News reported.

The reference has been filed in the SC on the advice of Prime Minister Shehbaz Sharif after the president approved the summary under Article 186 of the Constitution.

The reference will seek the opinion of the apex court on the settlement agreement on Reko Diq.

Earlier, the federal cabinet approved sending a presidential reference on Reko Diq case to the Supreme Court of Pakistan.

In March 2022, the then finance minister Shaukat Tarin announced that an agreement for the development of Reko Diq mine had been reached with a foreign company Barrick Gold, according to which Balochistan will have a 25% share.

Pakistan and Tethyan Copper Company (TCC) have agreed to divide shares with each side getting 50 percent of them, contrary to 25 percent shares for Pakistan in the previous deal.

In 2019, Pakistan managed to get a reduced penalty from a massive $16bn to $6bn in Reko Diq case.

In a 700-page ruling, ICSID awarded a US$4.08 billion penalty and $1.87 bn in interest to Pakistan. The amount will be paid to Tethyan Copper Company (TCC).

Tethyan Copper Company (TCC) had been granted a license for gold and copper mining at RekoDiq, area of Balochistan but the former chief justice of Pakistan Muhammad Chaudhry had cancelled the agreement with the company.

ARY
 
SC declares agreement for Reko Diq revival legal

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.


DAWN
 
SC declares agreement for Reko Diq revival legal

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.


DAWN

Another mess created by the mafia and the establishment that IK had to clear up.
 
$900m okayed for Chilean firm to exit Reko Diq

ISLAMABAD: After the Supreme Court endorsed a settlement deal worth over $6.5 billion last week, the government on Sunday approved a payment of more than $900 million to the Chilean firm Antofagasta over six years to exit the Reko Diq project.

The committee also green-lighted about $1.91bn shareholder financing by state-owned enterprises (SOEs) to take the gold and copper mining project forward.

The decisions were taken at a special meeting of the Economic Coordination Committee (ECC) of the cabinet presided over by Finance Minister Ishaq Dar through video link from Lahore to meet deadlines for an out-of-court settlement with the Tethyan Copper Company to avoid a looming $10bn international arbitration award. The ‘definitive agreements’ are ready to be signed by Dec 15 under the settlement deal.

Under the agreement, the government and its entities — the OGDCL, Pakistan Petroleum Limited and Govt Holdings Pvt Limited (GHPL) — have already deposited $900m in an escrow account for payment along with interest in six years to Antofagasta Minerals of Chile to exit the project.

These entities are also required to arrange about $4.3bn equivalent funds as an equity investment in the restructured project, now named Barrick Reko Diq Holdings Limited (BRDHL), to be operated by Canada’s Barrick Gold Corporation mining company.

“The ECC considered and approved two important agenda items related to the Reko Diq project, thus paving the way for early start of the Reko Diq Project,” an announcement said after the meeting, adding that it allowed the concerned divisions of the government and the SOEs to act in such a manner to ensure that the deposited amount along with interest deposited by the SOEs in the escrow account to form part of the consideration for share purchase of the Reko Diq Mining Company Limited.

Informed sources said the finance ministry told the ECC that as per ‘definitive agreements’ ready to be signed by Dec 15 under the settlement deal, the share of special purpose vehicle (SPV) of state-owned enterprises, namely Pakistan Minerals Ltd (SOE SPV) and the government of Balochistan (GoB SPV) towards the funding obligation in the restructured project is $1.194bn and $717m million, respectively, out of the $4.297bn to be adjusted for inflation.

This funding is required over six years, beginning with about $11m this year and gradually going up to $730m in the 2026-27 fiscal year.

In the case of project financing of up to 50pc, the above equity contribution could come down to $597m for SOEs SPV and $359m for the provincial one, whose financing arrangement is also the responsibility of the federal government.

The ECC thus authorised the finance ministry to initiate the process of issuing a guarantee from a mutually agreed financial institution or multilateral development lender for raising debt financing.

The Petroleum Division also submitted a summary for approval of accrued interest on the amount held in an escrow account ($900m) in connection with the Reko Diq project dispute settlement.

It told the Economic Coordination Committee that the federal and Balochistan governments had entered into an out-of-court dispute settlement with the Tethyan Copper Company Pvt Limited — a consortium of Barrick Gold and Antofagasta — over their longstanding dispute over the Reko Diq copper and gold mining project in the Chagai district.

As per settlement terms, the federal government has to clear liabilities to Antofagasta.

In light of the terms of the agreed settlement, the ECC allowed the finance division to direct the GHPL (for its own as well as the Balochistan government’s share), OGDCL and PPL to deposit the aggregate amount of interest to the sum of $22.72m in the escrow account from March 31 to Dec 15 this year.

The ECC further allowed the finance division to arrange the interest payable for the Balochistan government’s share amounting to $8.52m from the loan of Rs65bn already raised from the National Bank of Pakistan by the GHPL with the Pakistan government’s guarantee.

Under the restructured project, the Reko Diq project would now be led by Barrick Gold Corporation with 50pc shareholding along with operatorship.

Of the remaining 50pc shareholding, Balochistan will hold a 25pc stake, including a 10pc direct free share and 15pc through Balochistan Mineral Resources Limited, to be paid by the federal government along with capital and operational expenses.

The rest of the 25pc shareholding would be held with equal participation by the OGDCL, PPL and GHPL.

On Friday, the Supreme Court consented to a presidential reference on the subject and cleared for implementation the fresh Reko Diq settlement deal signed by the government of Pakistan with international mining firms to avoid arbitration penalties.

Pakistan had already been given an adverse arbitral award by the International Centre for Settlement of Investment Disputes and was anticipating a similar award from the International Chamber of Commerce.

DAWN
 
The Senate on Monday passed the Foreign Investment (Promotion and Protection) Bill, 2022 — paving the way for the reconstitution of a Reko Diq mining project — amid protests by PTI legislators over the “illegal arrest” of detained party leader Azam Swati.

Chants of “Release Azam Swati” and “issue production orders” reverberated through the house as protesting PTI legislators gathered around Senate Chairman Sadiq Sanjrani’s podium and registered their protest, while Law Minister Azam Nazeer Tarar presented the proposed law.
 
Cracks appear in ruling coalition over Reko Diq

Amid fragile political situation in the country, some cracks appeared for the first time in the ruling coalition on Tuesday when two allied parties boycotted the federal cabinet meeting over a controversial bill regarding revival of the Reko Diq copper and gold mine project in Balochistan.

Sources privy to the cabinet meeting, presided over by Prime Minister Shehbaz Sharif, told Dawn that two of the allies — Jamiat Ulema-i-Islam (JUI-F) and Balochistan National Party-Mengal (BNP-Mengal) — boycotted that meeting to register their protest, but later joined it.

Sensing the gravity of the situation, the PM formed a cabinet committee to remove grievances of JUI-F and BNP-M and held out an assurance that an amendment bill would soon be tabled in the parliament after consulting the two allies.

The annoyed parties were of the opinion that the recently passed Reko Diq related bill — the Foreign Investment (Promotion and Protection) Bill, 2022, in the Senate, was against the rights of the people of Balochistan and that both parties had not been taken on board during preparation of the bill.

After the cabinet meeting, both JUI-F and BNP-M held their separate meetings in which they discussed the option of leaving the alliance if their demands were not met.

However, Information Minister Marriyum Aurangzeb, in a post-cabinet meeting statement, said the cabinet had formed a committee to resol**ve grievances of the annoyed parties. “The cabinet committee will talk to leaders of the allied parties, take them into confidence and remove their reservations. An amendment bill will soon be tabled in the parliament after consultation,” she added.

She said the cabinet had approved the Reko Diq project funding plan and a final deal of the project with two international firms, which would be signed on Thursday.

The cabinet also approved a regulatory framework for reconstitution of the Reko Diq and state-owned enterprises.

The meeting was apprised that the Supreme Court on Dec 9 had 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” and “transparent”.

The Senate on Monday passed the Foreign Investment (Promotion and Protection) Bill, 2022 — paving the way for the reconstitution of a Reko Diq mining project.

In a Dawn TV show, PML-N leader Mian Javed Latif said the reservations of JU-F and BNP-M were justified and that the government would remove them within next two days. However, he was confident that the annoyed parties would not depart the coalition, as some amendments were being made to the bill.

Mr Latif said that not only the two parties but all four provinces had some reservations on the bill regarding 18th Constitution amendment and the issue would be resolved soon.

The original agreement for the Reko Diq mining project was signed in 2006, and it set aside a share of 37.5 per cent to Canada’s Barrick Gold and Chile’s Antofagasta each while the Balochistan government received a 25 per cent 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.

In March, the federal and Balo*ch*istan governments reached an agreement with two 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 paid by Pakistani shareholders.

Balochistan government holds a 25pc stake in the project under the new pact and other 25pc shareholding is controlled equally (8.33pc) by three state-owned enterprises.

DAWN
 
The federal and Balochistan governments signed an agreement on Reko Diq with the Canadian company Barrick Gold on Thursday, days after the Supreme Court endorsed a settlement to resume mining at the site located in Chagai district.

The agreement will take effect on Dec 16 (today) and the company will start work on the project with immediate effect.

In a statement issued late on Thursday night, the Balochistan government termed the agreement historic and the country’s biggest investment accord.

“After signing the Reko Diq agreement, the $6.5 billion fine imposed by an international court has become ineffective,” the statement added. Representatives of Barrick Gold Corporation and the federal and Balochistan governments signed the agreement at a ceremony attended by senior officials.


Canadian firm starts updating plans for mine after ‘favourable opinion’ from SC; Antofagasta exits project

One of the largest undeveloped copper-gold projects in the world, Reko Diq is owned 50pc by Barrick; 25pc by three federal state-owned enterprises; and 15pc and 10pc by Balochistan on a fully funded basis and free carried basis, respectively.

‘Favourable opinion from SC’

Barrick Gold also confirmed the development, saying it had completed the reconstitution of the Reko Diq project after “having received a favourable opinion from the Supreme Court of Pakistan and the required legislation having been passed into law”.

Barrick president and chief executive Mark Bristow said the completion of the legal processes was a key step in progressing the development of Reko Diq into a “world-class, long-life mine which would substantially expand the company’s strategically significant copper portfolio and benefit its Pakistani stakeholders for generations to come”, the company said in a statement on Thursday.

“We are currently updating the project’s 2010 feasibility and 2011 feasibility expansion studies. This should be completed by 2024, with 2028 targeted for the first production,” Mr Bristow said.

Antofagasta exits Reko Diq

Meanwhile, Antofagasta Plc said on Thursday it had exited the Reko Diq project as Barrick Gold Corp updated its plans for the mine, according to Alliance News equities news service.

Antofagasta, a London-based mining company, said the project had been reconstituted under Tethyan Copper Co Pty Ltd, a joint venture registered in Australia held equally by Antofagasta and Barrick Gold.

It said a consortium of “various Pakistan state-owned enterprises” had acquired shares in the Tethyan Copper Co subsidiary, which holds the project.

The proceeds of the sale, which together equals $945 million, will be held by Tethyan Copper. Antofagasta expects to receive the proceeds by the end of 2023.

While Antofagasta retains its shareholding in Tethyan Copper until the proceeds are distributed, it “will cease to have any appointees on the board and will no longer be involved in the business of TCC”.

DAWN
 
Unfazed by terror, Balochistan to press ahead with Reko Diq
Spokesperson laments that whenever a project is started, hostile elements are mobilised

The provincial government has expressed its determination to carry out development work in Balochistan to transform it into a trade hub despite the nefarious designs of hostile elements.

Addressing a press conference on Monday, the government’s spokesperson, Farah Azeem Shah, said that Reko Diq’s plan was approved on December 15, but some “unpleasant things” happened in Balochistan.

She noted that 16 people were injured in the attacks in Kohlu, Zhob and Barkhan and soldiers, including Captain Fahad, were martyred.

She added that the Reko Diq project was approved by the provincial government with great success as Pakistan faced a big fine and its assets were at stake.

...
https://tribune.com.pk/story/2393012/unfazed-by-terror-balochistan-to-press-ahead-with-reko-diq-1
 
Back
Top