Reko Diq deal: SC inquires about any mining policy, legal framework formulated

ISLAMABAD: The Supreme Court questioned what mining policy and legal framework the federal and the Balochistan governments have created for the transaction and in fact, the contractual obligations for the Reko Diq project.

A five-judge bench, headed by Chief Justice Umar Ata Bandial and comprising Justice Ijazul Ahsan, Justice Muneeb Akhtar, Justice Yahya Afridi, and Justice Jamal Khan Mandokhail, on Tuesday, heard the presidential reference.

The bench appointed advocates, Farogh Naseem, Salman Akram Raja, and Zahid Ibrahim as amici curiae and issued notices to the Pakistan Bar Council (PBC) and the Balochistan Bar Council (BBC) to assist in the presidential reference on the Reko Diq project.

The chief justice inquired the additional attorney general (AAG) what mining policy and legal framework the federal and the Balochistan governments have created for the transaction and in fact, the contractual obligations, adding the government needed not only to amend but should have framed new mining and mineral rules and regulations regarding the matter.

Justice Bandial said that in the ’70 when the government wanted to promote the private sector then the Board was constituted for that purpose. Justice Ijazul Ahsan said when the government has launched Independent Power Project then it changed the law, but the present government for such a huge foreign investment was only relying on the contract with Barrick Gold.

AAG Aamir Rehman, representing the Federation, said that in order to save $10 billion the federal government has decided to share $900 million to pay Antofagasta, the mining company, which is not interested in the Reko Diq project. He apprised Barrick Gold which will invest $4.5 billion on the project and if after sometimes it finds that the project is not feasible then Pakistan would have to lose nothing.

Rehman argued that the federal government is not challenging the apex court’s judgment (2013), adding it is a massive project and in over 20 years the foreign company will invest a huge amount in US dollars. With the mining and exploration, the adjoining areas of Reko Diq will also be developed.

The chief justice inquired the AAG you wanted to say that the SC’s judgment is a hurdle in commencing of the Reko Diq project? The AAG said that after the Supreme Court’s judgment in 2013, the Balochistan government started the Reko Diq development project and spent Rs5 to 6 billion. However, it was abandoned after the International Centre for Settlement of Investment Disputes (ICSID)’s judgment and the money spent went wasted.

Justice Muneeb Akhtar said that the federation would have to establish that there was a violation of the Regulation of Mines and Oil Fields and Mineral Development (Federal Control) Act, 1948 and the fundamental rights of the citizens.

Rehman said that the text of the bill has been approved by the federal cabinet. Justice Muneeb said that the resolutions passed by the National Assembly and the Balochistan Provincial Assembly should be made part of the bill.

At the outset, the AAG, while referring to the SC’s judgment of 2013, highlighted the flaws in the agreements signed between BHP and the BDA in 1993. He contended that the accord was in violation of the rules and the regulations, adding the rules were unlawfully relaxed and number of explorations licences were granted to TCC. The authority in Pakistan that allowed entering into the project with the foreign company was not competent.

Rehman said that the incumbent government is now doing everything within the four corners of the law. The negotiated settlement could be done through due diligence, public good and transparency.

He said that entering an international agreement there would be hardship, which is due to the pre-existent obligation in the shape of the ICSID’s award.

At the end of the hearing, Amanullah Kanrani through a video link from Quetta stated that the BBC wanted to become a party in this case. The court allowed the BBC to implead in this case.

Kanrani contended there are also individual rights, adding the federal government wanted to dilute the Supreme Court’s (2013) judgment.

The Balochistan High Court, in 2006, had validated the agreement, the Chaghi Hills Exploration Joint Venture Agreement (CHEJVA), but this ruling was reversed by the apex court.

Justice Bandial said they would not dilute anything, including the apex court’s judgment in Maulvi Haq case as nothing is above the law, adding the court would protect the rights of the people.

The case was adjourned until today (Wednesday).

Copyright Business Recorder, 2022