Islamabad, Mar 20 (PTI) Pakistan on Sunday signed an agreement with a Canadian company to develop one the world’s largest gold and copper mining projects in the country’s restive Balochistan province.
Popularly known as the Reko Diq project in Chagai area of the province, the project would be developed by the Barrick Gold Corporation of Canada.
According to a statement by the Prime Minister’s Office, Prime Minister Imran Khan witnessed the signing ceremony between the Government of Pakistan, the Government of Balochistan and the Canadian company.
The signing was made possible after successfully resolving the longstanding dispute with Tethyan Copper Company (TCC) concerning the development of copper and gold mines in Chagai, popularly known as the Reko Diq dispute.
“A new agreement was signed today by representatives of the federal and Balochistan Governments with a delegation of Barrick Gold, led by Chief Executive Dr Mark Bristow,” according to the statement.
The new project company shall be owned 50 per cent by Barrick Gold. The remaining 50 per cent shareholding shall be owned by Pakistan, divided equally between the federal and the provincial government of Balochistan.
Balochistan’s share of capital and operating expenses shall be borne by the federal government.
“In developing the project, nearly USD 10 billion shall be invested in Balochistan, including USD 1 billion that shall be invested in social upliftment projects such as roads, schools, hospitals and creation of a technical training institute for mining,” read the statement.
The 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.
The investment is expected to create over 8,000 new jobs.
The agreement was reached after several rounds of negotiations over the last three years.
Earlier, a delegation of Barrick Gold Corporation called on the Prime Minister. Canadian High Commissioner to Pakistan Wendy Gilmour was also present.
The Reko Diq project has been lingering for nearly three decades. It started when on July 29, 1993, BHP Minerals (BHP) and the Balochistan Development Authority (BDA) signed the Chagai Hills Exploration Joint Venture Agreement (CHEJVA).
Subsequently, on November 23, 2006, the TCC bought BHP’s interests in CHEJVA for USD 240 million and on August 26, 2011, it submitted its feasibility report and an application for mining lease which was rejected by the Licensing Authority on November 15, 2011.
But a petition was filed in Pakistan’s Supreme Court on November 6, 2011 against the project and after prolonged hearing, the court on January 6, 2013 declared the CHEJVA to be void ab initio.
The TCC in retaliation instituted proceedings before the ICSID, which on July 12, 2019 gave an award of USD 5.894 billion plus interest of USD 700,000 per day in damages against Pakistan to the TCC, which stood at USD 6.5 billion by March 1, 2022.
Khan in August 2019 set up a committee to steer the negotiations to resolve the dispute with TCC and start work on the development of the mines, leading to an out-of-court settlement and a new agreement to start the project. PTI SH CPS
