The Pakistan Industrial and Traders Association Front (PIAF) on Sunday appreciated the government for saving the country from $11 billion penalty in Reko Diq case and reconstituted a project aimed at excavating huge gold and copper reserves from the site in Balochistan.
PIAF senior vice chairman Nasir Hameed and Vice chairman Javed Siddiqi expressed the hope that the investment would mark the beginning of large-scale investments in Balochistan that would change the quality of life of ordinary citizens in the province.
Nasir Hameed said that the federal and Balochistan governments and two international firms have reached an agreement in principle on a framework to reconstitute the Reko Diq project, and a pathway for Antofagasta to exit the project.
PIAF congratulates the nation, specially the people of Balochistan, on the agreement for development of Reko Diq mine.
We greet the nation and PPL of Balochistan on successful agreement with Barrick Gold for development of Reko Diq mine after 10 years of legal battles and negotiations. Penalty of approximately $11 billion is off set, $10 billion will be invested in Balochistan creating 8,000 new jobs, he said and added that Reko Diq will potentially be the largest gold and copper mine in the world. It will liberate us from crippling debt and usher in a new era of development and prosperity.
PIAF vice chairman Javed Siddiqi said that after the signing of the agreement Pakistan would not only avoid the $11bn penalty but also get an opportunity to explore the world’s largest gold and copper reserve.
He said some $10bn would be invested under the Reko Diq project which would create 8,000 new jobs for the locals. He said that as per the new agreement, Barrick Gold Corporation would get 50 per cent and the Balochistan government 25pc share, while the rest 25pc would be shared among the state-owned enterprises — Oil and Gas Development Company (OGDCL), Pakistan Petroleum Limited (PPL) and Government Holdings Pakistan (GHPL).
He recalled that the federal and Balochistan governments had in 2006 signed an agreement with Canadian company Barrick Gold and Chilean firm Antofagasta to extract gold and copper from Reko Diq mine. According to the deal, 37.5pc share each was given to the two foreign companies and 25pc to the Balochistan government.
He said that agreement was suspended in 2011 due to a dispute over the legality of its licensing process. As a result, the International Court of Arbitration levelled $6.4bn award on the government of Pakistan while at the same time the London Court of Arbitration was also imposing another $4bn fine on Pakistan.
He said that soon after taking over the charge, the PM aggressively pursued the case. As a result, an agreement was signed under which Antofagasta decided not to participate in the reconstituted project and withdrew from its claim of $3.9bn in place of $900 million, which would be paid by the three state-owned enterprises in return for a 25pc share.
He said that Pakistan, particularly Balochistan, would be benefited for over 100 years from this project and the total worth is estimated to be over $100bn.
Terming the deal a landmark achievement, he said it was a historic day as it had not only avoided $11bn worth of penalty but also created a new opportunity for the country. He said the landmark success had also saved the country from blacklisted by the FATF by implementing 32 of the 35 conditions.