ISLAMABAD: Government of Pakistan has reached an agreement Barrick Gold Corporation in principle on a framework to reconstitute the Reko Diq project and a pathway for Chile-based Antofagasta to exit the project.
A new agreement was signed on Sunday by representatives of the Federal and Balochistan governments with a delegation of Barrick Gold led by Chief Executive Dr Mark Bristow and witnessed by Prime Minister Imran Khan.
The agreement was reached between the Government of Pakistan, Government of Balochistan and Barrick Gold Corporation of Canada 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.
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. The new project company shall be owned 50% by Barrick Gold. The remaining 50% shareholding shall be owned by Pakistan, divided equally between federal government and the provincial government of Balochistan.
Federal Government’s 25% shareholding shall be divided equally amongst three state-owned-entities (SOEs) of the Federal Government, namely Oil & Gas Development Corporation Limited (OGDCL), Pakistan Petroleum Limited (PPL) and Government Holdings Pakistan Limited (GHPL). Balochistan’s share shall be held by a company wholly owned and controlled by the provincial government.
READ MORE: PM felicitates nation on new Reko Diq mine agreement
As part of the Prime Minister’s vision for Balochistan, the Government of Balochistan’s share of capital and operating expenses for the project shall be borne by the federal government. In other words, the Government of Balochistan shall not incur any expenses in development of the mines.
In developing the project, nearly $10 billion shall be invested in Balochistan, including $1 billion that shall be invested in social uplift projects such as roads, schools, hospitals and creation of technical training institute for mining. The investment shall create over 8000 new 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. To ensure optimal utilization of nation’s mineral wealth the government is also considering setting up a smelter.
The agreement was reached after several rounds of negotiations over the last three years. In August 2019, the prime minister 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. To ensure the deal is compliant with all the laws, the Government shall submit the matter before the parliament and the Supreme Court.
While speaking at the occasion, the prime minister stressed on the emphasis his government places on development of Balochistan and uplift of underdeveloped areas. He expressed hope that the investment will mark the beginning of large scale investments in Balochistan that shall change the quality of lives of ordinary citizens in Balochistan.
The prime minister appreciated the efforts of the negotiating team for a transparent and favourable agreement for the people of Balochistan. Earlier, a delegation of Barrick Gold Corporation called on the Prime Minister. Canadian High Commissioner to Pakistan Ms. Wendy Gilmour was also present.
