Pakistan

World Bank rules against Pakistan in Reko Diq case

Arbitration claim against Pakistan was filed for unlawfully denying a mining lease for Reko Diq project in 2011

News Desk March 22, 2017

The hearing will continue till October 17. STOCK IMAGE

An arbitration tribunal of the World Bank's International Center for Settlement of Investment Disputes (ICSID) on Monday ruled against Pakistan in relation to the unlawful denial of a mining lease for the Reko Diq project in 2011.

The International Center for Settlement of Investment Disputes’ (ICSID) verdict came after Tethyan Copper Company Limited (TCC), a joint venture between Antofagasta and Barrick, filed an arbitration claim against Pakistan for unlawfully denying a mining lease for the Reko Diq project.

“The decision by the ICSID tribunal rejected Pakistan's final defense against liability, and confirmed that Pakistan had violated several provisions of its bilateral investment treaty with Australia, where TCC is incorporated,” Chilean mining company Antofagasta announced. However, the claims could not be independently verified.

World bank report: Pakistan among top 10 economies

The damages phase of the proceedings will begin on March 22, during which the tribunal will consider submissions from the parties to determine the amount that Pakistan must pay TCC. A ruling on the quantum of damages is expected in 2018.

In January, 2013, the Supreme Court had declared invalid the Reko Diq agreement – a lease for one of the world’s richest deposits of gold and copper in Balochistan held by the TCC – observing that the agreement ran counter to the country’s mineral development act and mining concession rules.

A three-judge bench of the apex court, headed by Chief Justice Iftikhar Muhammad Chaudhry, declared “not valid” the Chagai Hills Exploration Joint Venture Agreement (CHEJVA), the initial 1993 exploration agreement between the Balochistan government and Australian mining group BHP.

Indus waters treaty: World Bank president calls Dar

Tethyan Copper Company

Reko Diq is one of the world’s richest deposits of gold and copper held by a Canadian-Chilean consortium that includes Vancouver-based giant Barrick Gold.

Barrick, the world’s largest gold producer, and Chile’s Antofagasta Minerals, each own a 37.5% share, as the Tethyan Copper Company, in the largest Foreign Direct Investment mining project in Pakistan.

Their plan was to build and operate a copper and gold open-pit mine at Reko Diq in the Chagai district of Balochistan.

COMMENTS (20)

Ammar | 7 years ago | Reply @RK Singh: if you read this article carefully, without any bias, you will realize that the case is filed against Islamic Republic of Pakistan, not Baluchistan.

powayman | 7 years ago | Reply This has been a long standing issue that has been ignored by the press and govt long enough. The estimated liability maybe several Billion dollars (maybe much much). I doubt Pakistan has developed a contingency fund to handle this liability which means that it's going to be quite a shock to the economy. Perhaps it's time that ET assign a reporter to investigate and write an article about this debacle?

VIEW MORE COMMENTS

gp65 | 7 years ago | Reply @Saba: "But Nagaland isn’t in India and you guys keep claiming it is!" Huh? See any world map - it shows Nagaland as part of India. Check the passports of people from Nagaland - they are Indian. Who oversees elections in Nagaland? The Indian Chief election commissioner.

Abdul Majid | 7 years ago | Reply @virkaul Pay millions and become an owner of trillions? Please make same arrangements in India too, we will sure invest there too on same points.

RK Singh | 7 years ago | Reply @Tanzeel Baloch: Just because you call yourself Baloch does not mean you are Baluchi.

Virkaul | 7 years ago | Reply @Abdul Majid: Tethyan were not labourers here but owners of the mines after they paid money to govt of Pakistan towards lease. No developer of a mine would ever accept a clause which bars him from mining after he has invested millions into the Project. It is like telling the Chinese to go back from Gwadar. No, you can not do that. Of course World Bank is a lender and cannot enforce its decision but Pakistan can be blacklisted by it, which Pakistan can ill afford.

Saba | 7 years ago | Reply @RK Singh: But Nagaland isn't in India and you guys keep claiming it is!

mohammad khan | 7 years ago | Reply Another East India Company in the making. Pakistan how could you have made such a mistake in the first place. You will regret it for thousand years. Reko Diq belongs to people of South Asia why should it be exploited by foreigners. People of Pakistan and whole south Asia should revolt now. We need 1000 more sensible people like Justice Iftikhar Chaudhary. MayNani Mata Hinglaj and Kali Mata come with rage of jwalamukhi and destroy the exploiters and cheaters.

P.S. Purba | 7 years ago | Reply @RK Singh: Amritsar is in Khalistan too, but thats not the point here, so got it?

Ibne Khaldun | 7 years ago | Reply In the Indus water treaty, World bank was a Guarantor. In the Reqo Dik, World bank has NO ROLE. If the other company used a shell, that is itself a fraud.

AKA | 7 years ago | Reply DO NOT GET IT WORLD BANK IS MADE FOR BIG CO-OPERATION TO PUT THERE FEET ON BIG RESORCES ,IF YOU DO NOT AGREE WITH THEM THEY WILL COME AFTER YOU ONE WAY OR OTHER.THANK YOU ARE LOW LIFE POLITICAN .

Ibne Khaldun | 7 years ago | Reply 911 Fraud and Deception has led to a lot of distortions in the economic dealings of the world of Islam with the western countries. This must be rectified.

Tanzeel Baloch | 7 years ago | Reply @RK Singh: Mr Sing .... Balochistan is Pakistan ...... it's not Kashmir my Friend ....... this is our internal issue and we reserve all the rights ....

Peanut | 7 years ago | Reply @Abdul Majid: This is not your local magistrate's ruling that you "chose" not to accept. This is a world bank tribunal that gives ruling in the light of law.

rich | 7 years ago | Reply Abdul Majid We Pakistanis can not accept the verdict of the World Bank… hmmm does that apply for indus water treaty to with india, guaranteed by WB?

RK Singh | 7 years ago | Reply @Abdul Majid: You want India to respect World Bank , but when it comes to Pakistan, you want to say get lost? The copper mines are in Baluchistan. Not Pakistan.

Parvez | 7 years ago | Reply Pakistan will have to pay...but the people who caused this damage most probably are sitting abroad enjoying.

Sara | 7 years ago | Reply When it comes to saving their money making companies, the western justice system is swift. Not so in the case of altar Hussain

Suhas | 7 years ago | Reply Why is Pakistan leasing out its resources to companies based outside of its borders? It is the politicians who make money out of this.

Abdul Majid | 7 years ago | Reply The owner of the mines, in this case, Pakistan reserves the right to explore or stop explore its grounds anytime whatever is the reason. Basically a labourer may be stopped from working on any site by the owners as they have the right to allow anybody or disallow or ban anybody at its sites. We Pakistanis can not accept the verdict of the World Bank... In short no exploration by any outsiders for the mines and precious wealth of our own.

Replying to X