Pakistan seeks review in Reko Diq case

Minister says country may face seizure of foreign assets if damages imposed

ISLAMABAD: Pakistan on Monday said it would challenge massive $5.976 billion award, announced against it in the Reko Diq case by the International Center for Settlement of Investment Disputes (ICSID) in July this year.

“Pakistan would go into appeal against this decision. Pakistan assets could be seized if damages are imposed on Pakistan,” said Minister for Energy Omar Ayub, while addressing a press conference.

The minister blamed the past governments for taking unwise decisions that resulted in such damages, adding that Pakistan also faced US$1.2 billion damages in Karkey rental power case.

The ICSID on July 12 issued a 700-page ruling against Pakistan in the Reko Diq case while hearing a plea of Tethyan Copper Company’s (TCC).  The TCC has already approached a US district court for the enforcement of the award against Pakistan.

He said Independent power producers (IPPs) and other parties went to international court against Pakistani government due to failed policies of previous governments.  “Pakistan is also burdened with Rs24,000 billion. People should know about those behind such heavy loans,” he said.

Regarding payment of Rs1.5 billion to Rosch power plant on account of capacity charges, he said the Economic Coordination Committee (ECC) of the Cabinet had approved the payment in 2017 during tenure of Pakistan Muslim League-Nawaz (PML-N).

“The past government had also decided to run this power plant on LNG instead of indigenous gas,” he said, adding that the past government had no money to pay to the IPPs.

He said Rosch power had preferred local arbitrator whereas remaining eleven companies had gone to international arbitrator. He said the government had to pay around Rs15 billion to these companies due to award given in favour of these IPPs in international court.

“The government is making out of court settlement with the power companies to stop them from going into the international court,” he said. To a question regarding circular debt, he said 88 per cent energy payments were being made to power produces and claimed to end the entire circular debt in 2020.

Responding to a question about load shedding, he said there has been load shedding when PTI government came into power. However, he said, all feeders are operational now due to improvement in electricity supply and there is zero load shedding in the country.

With regard to Gas Infrastructure Development Cess (GIDC), he said the cabinet had decided to conduct a forensic audit of fertilizer plants. However, when questions were raised, the government decided to refer the matter to Supreme Court for resolution.

He said the government would spend money collected on account of the GIDC on development of gas infrastructure if the SC decides in favour of government.

Responding to question, he ruled out the rumours about Prime Minister Imran Khan minus formula. “Imran Khan is leader of the party and would remain in government. He would also come into power for another five years after the next election,” he claimed.