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July 18, 2019

Mining mishaps

Newspost

 
July 18, 2019

The Reko Diq mine issue has been grossly mishandled from its very inception, to its taking up by the Supreme Court and gross administrative and bureaucratic mismanagement of letting it go to the ICSID. Pakistan facing a financial crisis, most of which is its own making, and has been slapped with compensation penalty of $6 Billion. What more will it take to realize that we live in a world where specialists in the relevant fields must be involved in decision-making? Most of our problems, whether it be the economic crisis or the threat of terrorism and religious extremism, to political instability that threatens our national interest, are entirely of our own mishandlings and because we leave the process of decision-making in the hands of people who were incompetent and unqualified for the tasks at hand, or had no constitutional or moral authority to consider when making decisions.

What caused the Reko Diq issue is that the then government headed by ex-PM Moin Ahmed Qureshi and his CM of Balochistan decided to sign an exploration contract in the area in July 1993 with BHP Minerals. In June 2000, the government in power signed a joint venture with Pakistan getting 25 percent of the profits and BHP getting the bulk of the profits of 75 percent in violation of the internationally established practice of fifty-fifty shares. Australia’s Tethyan Copper Company had a joint venture with Canada’s Barrick Gold and Chile’s Antofagasta PIC for an exploration contract for copper Mining in Reko Diq. It is normal in the international mining industry practice that only after the value of minerals available has been established through exploration is an agreement negotiated for the distribution of assets mined. The country where the mine is located would normally never settle for less than equal shares and international mineral companies would not hesitate to invest billions of dollars to earn revenue worth several times more than their investment.

Malik Tariq

Lahore

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