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.
The federal cabinet during a meeting on September 30 had approved filing the presidential reference with respect to the following questions of law of public importance: Is the deal with the complainant company, TCC, compliant with the apex court’s earlier judgement in the Maulvi Abdul Haq case; second, is the proposed Investment Protection Act compliant with the Constitution?
Earlier, Barrick Gold Corporation, a Canada-based mining group, had asked the government to get the Reko Diq gold and copper deal stamped by parliament and the Supreme Court for the 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.
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.