ECC approves Reko Diq mineral exports via Port Qasim

ISLAMABAD: The Economic Coordination Committee (ECC) of the cabinet on Tuesday granted its approval for the export of minerals from Reko Diq through the Bulk Terminal at Port Qasim, winding up of Pakistan Agriculture Storage and Services Corporation Limited (Passco) and clearing of Rs527.66 billion liabilities through the establishment of a special purpose vehicle (SPV) and Rs50 billion for fencing of Pak-Iran border. Another circular debt is on the anvil for the commodity sector, amounting to Rs120 billion, primarily due to wheat stocks, considering receivables and liabilities of Passco, which is set to be closed down.

In an official announcement, the Ministry of Finance did not share details of the decision to use the Pakistan International Bulk Terminal at Port Qasim for the export of gold, copper, minerals and metals produced from Reko Diq. In the last meeting, this summary of the Ministry of Maritime Affairs was deferred as the ECC gave direction to get the viewpoint of the attorney general on it. The ECC has now approved the summary.

The ECC also approved a Technical Supplementary Grant (TSG) of Rs50 billion for fencing the Pak-Iran borders, lighting of areas and provision of allowances.

The ECC was informed that the minister for finance was leading the process of winding up of Passco under the prime minister’s direction in consultation with the Ministry of National Food Security & Research.

The finance minister has held five meetings to finalise the mechanism for the disposal of wheat stock. It was informed that there are total liabilities of Rs527.664 billion, as total receivables from the federal and provincial governments are standing at Rs406 billion through the possibility of sale of wheat stocks, but the remaining outstanding amount is estimated at Rs121 billion, which will remain to be settled for closing the balance sheet before winding-up of Passco. The ECC approved to establish the SPV, and the federal government will service the SPV’s debt through annual budgetary allocation over a period of five to seven years in line with the authorisation schedule to be agreed with the lenders.

According to an official announcement, the ECC met at the Finance Division under the chairmanship of Finance Minister Muhammad Aurangzeb, to consider a range of summaries pertaining to national security, defence, food security and petroleum sector reforms.

The ECC approved a Technical Supplementary Grant (TSG) of Rs100.3 million on the request of the Ministry of Interior & Narcotics Control for the maintenance and repair of defence equipment utilised by the Federal Civil Armed Forces.

On another summary submitted by the Ministry of Interior & Narcotics Control, the forum approved an additional Rs841.56 million as TSG to support border control operations, internal security and maintenance of law and order by the Federal Civil Armed Forces.

It further considered and approved a summary from the Defence Division, granting a TSG of Rs50 billion for a range of approved projects of the Defence Services.

In addition, the committee discussed a summary submitted by the Petroleum Division concerning the extension of licence periods and assignment of working interest for offshore oil and gas exploration blocks. It approved the set of proposals aimed at incentivising and facilitating greater participation of foreign companies in Pakistan’s petroleum exploration sector.

The forum approved PPL’s request for Assignment of Participating Interests in the Eastern Offshore Block-C, marking a significant milestone in Pakistan’s offshore exploration efforts. Under the approved arrangement, the Participating Interests in the block will be held by Turkish Petroleum Overseas Company (TPOC) at 25 percent, Pakistan Petroleum Limited (PPL) at 35 percent, Mari Energies Limited at 20 percent, and Oil & Gas Development Company Limited (OGDCL) at 20 percent.