Pakistan is seeking relief in fine of $5.8 billion imposed by an international tribunal.
According to details, an international tribunal imposed penalty on Pakistan for denying a mining lease to an Australian company. While Pakistan says that paying the fine would slow down its handling of the Covid pandemic.
Reko Diq, the town of gold is situated in Chagai district of Balochistan, known for its mineral wealth, including gold and copper.
Prime Minister Imran Khan’s government considers it a strategic national asset, though instead of yielding a bonanza the Reko Diq mining project may cost the country dearly, Dawn news reported.
The World Bank’s International Centre for Settlement of Investment Disputes is considering Pakistan’s appeal against enforcing the penalty over its cancellation of the Reko Diq mining lease for Tethyan Copper Corp, a 50-50 joint venture of Barrick Gold Corp of Australia and Antofagasto PLC of Chile, Dawn report said.
According to Tethyan, 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. Tethyan says its 1998 agreement with the local Balochistan government entitled it to the mining lease, subject only to routine government requirements.
The project stalled in November 2011 when the Balochistan provincial government rejected the application.
Tethyan Copper discovered vast mineral wealth more than a decade ago in Reko Diq, at the foot of an extinct volcano near Pakistan’s frontier with Iran and Afghanistan. The deposit was set to rank among the world’s biggest untapped copper and gold mines, Reuters reported.
The company said it had invested more than $220 million by the time Pakistan’s government, in 2011, unexpectedly refused to grant them the mining lease needed to keep operating. 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 against Tethyan by Pakistan’s Supreme Court.
According to another report, during the discussions for the sales of the M-9 and M-11 missiles to Pakistan, China asked for a 20-year lease to the mineral-rich areas of Chagai in Balochistan, and currently China is operating in Saindak mines of Chagai.
It is not the only problem surrounds those rich mines but also a long insurgency is going on in Balochistan for independence of the region by Pakistan and the armed groups have also been targeting the Chinese engineers and other government exploration companies.
In year 2018, a Baloch pro-independence group carried out an attack on Chinese engineers working on Saindak project.
Baloch political parties and nationalists claim that Pakistan and China are plundering their national wealth without their consent and local people are not receiving any benefits, not even basic facilities of life.
The discovery of copper and gold deposits at Saindak was made in the 1970s in collaboration of Pakistan and a Chinese engineering firm.