ISLAMABAD: Pakistan’s military is taking a key role in the development of one of the world’s biggest untapped copper and gold deposits, which is currently stalled by a multi-billion dollar legal wrangle with foreign mining firms, multiple sources familiar with the situation said.
The Reko Diq mine has become a test case for Prime Minister Imran Khan’s ability to attract serious foreign investment to Pakistan as it struggles to stave off an economic crisis that has forced it to seek an International Monetary Fund bailout.
Ten current and former provincial and federal government officials and mining sources familiar with the project in the Baluchistan region say the military has become the most important voice on the future of Reko Diq, which it sees as a strategic national asset.
The military will not only be in a position to decide which investors develop the deposit, but an army-controlled engineering firm, Frontier Works Organization (FWO), is positioning itself to be a member of any consortium involved, these people said.
“This has been taken over by GHQ,” said a senior Baluchistan government official, referring to the Pakistan army’s General Headquarters in the garrison city of Rawalpindi.
In a statement in response to Reuters’ questions about its role in Reko Diq, the military spokesman’s office said: “(The military) may only participate in government’s plan of development of Reko Diq, as per national requirements.”
But it acknowledged that FWO, best known for building roads through Pakistan’s rugged and lawless border regions, has developed “substantial” mining capability in recent years and would be interested in taking a role in the project.
“If an opportunity arises of participating in developing Reko Diq, FWO may work at par with other competitors (or) companies provided the project is financially viable (or) suitable,” the statement said. When asked, a spokesman declined to elaborate on the statement.
Pakistan’s Information Minister Fawad Chaudhry said civilian authorities in the insurgency-hit southwestern province of Baluchistan were in charge of Reko Diq and, along with Khan, would take a decision, but added that the military “and all other stakeholders are obviously important players.”
FWO referred questions to the military spokesman’s office. Khan’s spokesman Iftikhar Durrani said Baluchistan province was in charge of Reko Diq, and referred questions to the provincial government and the military spokesman’s office.
The manoeuvring behind the project shows how the military, which has historically dictated Pakistan’s security and foreign policy, is leveraging its sway over the civilian government at federal and provincial level to carve a growing role in the nation’s business affairs.
“The military has taken a front seat,” said Ayesha Siddiqa, author of the book “Military Inc.,” which analyzes the army’s business interests and influence in Pakistan.
“They’ve understood that the economy is important for having a strong military,” she said. “Control of the economy also gives the military a handle over expanding their business interests.”
TALKS
Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, the mine’s development has long been delayed by a dispute with previous investors in the project, Canada’s Barrick Gold and Chile’s Antofagasta.
The government is urgently trying to settle the dispute as a World Bank arbitration tribunal, which ruled against Pakistan in 2017, is in the next few months expected to announce how much in damages the country must pay to the foreign firms, who are claiming more than $11 billion.
The dispute relates to the withholding of a mining lease.
Islamabad is also trying to find new partners to invest in the project.
But any new investors will need the blessing of Pakistan’s military, according to government officials and mining sources.
State-run companies from resource-hungry China have long coveted Reko Diq and more recently Saudi Arabia has shown interest, according to Pakistani officials.
Some Western diplomats say the Reko Diq dispute has been a significant foreign investment deterrent, with international businesses unnerved at how Pakistan dealt with the companies that had pledged to invest $3.3 billion to develop the country’s then-biggest mining project.
Barrick Gold and Antofagasta, whose joint venture Tethyan Copper Company (TCC) discovered vast mineral wealth in Reko Diq, say they had invested more than $220 million by the time the Baluchistan government, in 2011, unexpectedly refused to grant them the critical mining lease needed to keep operating.
Pakistan argued its move was legitimate because TCC’s feasibility study was incomplete and the country’s Supreme Court voided the deal in 2013. But in 2017 the World Bank’s International Center for Settlement of Investment Disputes (ICSID) ruled against Pakistan.
TCC did not respond to requests for comment and Antofagasta and Barrick Gold both declined to comment. Reuters could not determine whether either company would be willing to return to the project.
FOREIGN INVESTORS
The last serious attempt at settling the Reko Diq case was scuppered in 2016 by the military, which vetoed paying hundreds of millions of dollars to TCC, according to a senior Baluchistan official and two former senior officials in Islamabad.
But the military has since changed its stance and is more open to a settlement with TCC, according to a lawmaker close to the military and a source close to Prime Minister Khan. The military was also involved in appointing Pakistan’s current legal team.
In response to a Reuters question about blocking the previous settlement effort, the military said: “Let’s see how the case progresses.” It did not elaborate or comment on whether it was playing any role in the latest negotiations.
Some mining experts say a likely solution would be for a new investment consortium to pay the settlement fee on behalf of cash-strapped Pakistan in exchange for future royalty fees or mining rights.
Information Minister Chaudhry said Pakistan was engaged in negotiations with “both” the current investors about a settlement and also potential new investors, with interest coming from the Middle East and Europe. He declined to name the potential investors.
Pakistani Finance Minister Asad Umar said in October that Saudi Arabia has inquired about investing in Reko Diq and another government official confirmed talks were ongoing.
Saudi Arabia did not respond to a Reuters request for comment on Reko Diq. During Crown Prince bin Salman’s visit to Pakistan last month, the kingdom pledged to invest $2 billion in mineral development projects, though the provisional agreements were vague and did not mention any specific projects.
China’s state-owned miner China Metallurgical Group Corporation (MCC), which operates the Saindak copper and gold mine close to Reko Diq, has been eyeing the bigger deposit for more than a decade, according to mining and MCC officials.
A few years ago Chinese state giant Norinco also made an approach, according to two sources familiar with Norinco’s offer.
MCC and Norinco did not respond to requests for comment.
When a mining company approached former general Abdul Quadir Baloch about Reko Diq around 2016, when he was federal minister for the frontier regions, he took their proposal not only to then-premier Nawaz Sharif, but also to the army chief.
“The military has to give a (security) guarantee to any company coming in to explore or exploit this project, so they are a stakeholder,” said Baloch.
The military declined to comment on Baloch’s assertions. Sharif, who has since been jailed on corruption charges, could not be reached for comment.
The army-run FWO does not have the funds or the expertise to develop the Reko Diq project, which boasts 5.9 billion tons of ore. But it could be part of a consortium alongside global miners who have the know-how to mine such a gargantuan deposit.
The military’s role in developing natural resources in Baluchistan also carries risks, however, analysts say.
Indigenous Baloch people view outsiders with suspicion, and their anger about Islamabad exploiting the province’s vast natural resources has been one of the key themes fueling a separatist insurgency that began around 2004.
Pakistan military eyes key role developing giant copper and gold mine
Pakistan military eyes key role developing giant copper and gold mine
- Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, Reko Diq has world’s biggest untapped copper and gold deposits
- The project boasts 5.9 billion tons of ore inviting foreign investors
Pakistani journalists’ visit to Israel not ‘possible’ under existing rules, Islamabad says
- Israeli media reported a 10-member Pakistani delegation this month visited Israel for a week
- Islamabad says its position on Israel ‘remain unchanged,’ reiterates its support for Palestine
ISLAMABAD: Pakistan’s Foreign Office on Tuesday responded to reports of a group of Pakistani journalists traveling to Israel, saying it was not “possible” under the existing rules.
Israel Hayom, a Hebrew-language Israeli newspaper, last week published a report that a 10-member Pakistani delegation of journalists, intellectuals and influencers had visited Israel for a week.
English-language Israeli newspaper The Jerusalem Post said this week these Pakistanis visited Israel to learn about the Holocaust and the October 7, 2023 attacks by Hamas.
Pakistan does not recognize Israel and has consistently called for an independent Palestinian state based on “internationally agreed parameters” and pre-1967 borders.
“The Government of Pakistan has noted reports regarding Pakistani journalists traveling to Israel. In this regard, it is clarified that Pakistani passports explicitly state they are ‘not valid for travel to Israel’,” the Pakistani Foreign Office said in response to media queries.
“Therefore, no such visit is possible under existing regulations.”
The Hayom newspaper report said the ten Pakistani journalists and researchers, including two women, arrived in Israel this month and carried passports declaring their invalidity for travel to Israel.
“Despite this, they bravely accepted an invitation from Sharaka, an organization working to strengthen relations between Israel and South Asian countries,” the report said. “To protect the delegation members, their passports were not stamped, and publication of their visit was delayed until they returned safely home.”
However, the Foreign Office in Islamabad said Pakistan’s position on Israel “remains unchanged.”
“Pakistan does not recognize Israel and steadfastly supports the legitimate rights of the Palestinian people, including the establishment of an independent and sovereign Palestinian state based on pre-1967 borders,” it said.
The South Asian country has consistently called for a cessation of Israeli military campaign in Gaza and strongly condemned the resumption of Israeli strikes in the territory last Tuesday, saying they could fully reignite the 17-month-old war that has killed more than 48,000 Palestinians.
Islamabad has also dispatched more than two dozen aid consignments for the Palestinian people since Israel began pounding Gaza in Oct. 2023.
“Pakistan reiterates its unwavering commitment to a just and peaceful resolution of the Palestinian issue in accordance with relevant UN resolutions and the aspirations of the Palestinian people,” the Pakistani Foreign Office added.
As Ramadan ends, a new cookbook sheds light on Pakistan’s varied cuisine
- Cutlets, kebabs, mutton karahi, diced meat simmered in tomato sauce spiked with ginger and chilies, and more round out the meal on the Eid Al-Fitr holiday that marks the end of Ramadan
- These dishes, and many of the associated ones, make it into Maryam Jillani’s book, but she would be the first to acknowledge they represent just a sliver of the nation’s varied cuisine
When Maryam Jillani was growing up in Islamabad, the last day of Ramadan was about more than breaking a month-long fast with extended family.
A joyous occasion, the Eid Al-Fitr holiday also was marked with visits to the market to get new bangles, wearing her best new clothes and getting hennaed. Not to mention the little envelopes with cash gifts from the adults.
“But, of course, food,” said Jillani, a food writer and author of the new cookbook “Pakistan.” “Food is a big part of Eid.”
At the center of her grandmother Kulsoom’s table was always mutton pulao, a delicately spiced rice dish in which the broth that results from cooking bone-in meat is then used to cook the rice. Her uncle would make mutton karahi, diced meat simmered in tomato sauce spiked with ginger and chilies.
Cutlets, kebabs, lentil fritters and more rounded out the meal, while dollops of pungent garlic chutney and a cooling chutney with cilantro and mint cut through all the meat. For dessert were bowls of chopped fruit and seviyan, or semolina vermicelli noodles that are fried then simmered in cardamom-spiced milk.
The vegetable sides were the one thing that changed. Since Ramadan follows the lunar Islamic calendar, it can fall any time of year.
These dishes, and many of the associated memories, make it into Jillani’s book, but she would be the first to acknowledge they represent just a sliver of the nation’s varied cuisine.
Her father, who worked in international development, used to take the family to different parts of the country. Later, she did her own development fieldwork in education across rural Pakistan.
Along the way, she found striking differences between the tangier, punchier flavors in the east, toward India and China, and the milder but still flavorful cuisine in the west, toward Afghanistan.
“I knew our cuisine was a lot more than what we were finding on the Internet,” she said.
After moving to Washington, D.C. as a graduate student, she started the blog Pakistan Eats in 2008 to highlight dishes that were lesser known to Western cooks. Research on the book began 15 years later, and she visited 40 kitchens in homes across Pakistan.
“Even though I hadn’t lived in Pakistan for over 10 years, each kitchen felt like home,” she writes in the book’s introduction.
She includes what she calls “superstars” of the cuisine, such as chicken karahi, one of the first dishes Pakistanis learn to make when overseas to get a taste of home. The meat is seared in a karahi (skillet) and then braised in a tomato sauce spiced with cumin, coriander, ginger, garlic and chilies before a dollop of yogurt is stirred into the pot.
Other recipes reflect the diverse nature of Pakistan’s migrant communities, such as kabuli pulao, an Afghan rice dish made with beef, garam masala, chilies, sweetened carrots and raisins.
“The idea behind the cookbook is to try to play my small part in carving out a space for Pakistani food on the global culinary table,” she said.
And of course, honoring her grandmother’s mutton pulao.
Jillani is hosting Eid this year at her home, now in Manila, Philippines, and she plans to make it, as well as an Afghan-style eggplant, shami kebabs, and the cilantro and mint chutney.
“If I’m feeling especially ambitious that day, I might make a second mutton dish,” she said. “I’ve been a bit homesick.”
Pakistani energy giants increase investment in Reko Diq copper-gold mine project to $1.25 billion
- Reko Diq, one of the world’s largest underdeveloped copper-gold mine, is jointly owned by Canadian mining firm Barrick Gold Corp. and Pakistan
- Feasibility study shows project has a mining life of 37 years and is expected to yield 13.1 million tons of copper and 17.9 million ounces of gold
KARACHI: Pakistani state-owned Oil & Gas Development Company Ltd. (OGDCL) and Pakistan Petroleum Ltd. (PPL) have increased their investments in the Reko Diq gold and copper mining project to $1.25 billion, the energy firms said in separate filings in the Pakistan Stock Exchange (PSX).
The OGDCL and PPL, each holding 8.33 percent stake in the multi-billion-dollar project through Pakistan Minerals (Private) Limited, have completed their feasibility studies. The third state-owned shareholder is Government Holdings (Private) Limited, according to the stock filings.
Each of the two oil and gas explorers have decided to increase their funding commitment with respect to the project, reflecting their pro rata share of total capital investment, inclusive of project financing costs, to $627 million. The financing cost is to be adjusted according to the actual project cost and inflation.
On Tuesday, the Economic Coordination Committee (ECC) of the federal cabinet also approved a summary regarding the Reko Diq project and changes in its overall development plan, the Finance Division said in a statement.
“The ECC took up a summary by the Petroleum Division regarding the Reko Diq Project and changes in its overall development plan and related financial commitments and project finance considerations due to inflation and enhanced scope of the project concerning capacity, energy mix, alternative water supply options and updated processing plants and machinery,” the statement read.
“The ECC noted the factors leading to the project escalations, and approved the proposals contained in the summary with the directions to the Ministries of Petroleum & Finance to continue close coordination with a view to ensuring timely implementation of all agreed actions.”
Reko Diq, one of the world’s largest underdeveloped copper-gold mine, is jointly owned by Canadian mining firm Barrick Gold Corp. and Pakistan. Out of the total shareholding of Reko Diq project, 25 percent is held by the provincial government of Balochistan — 15 percent on a fully funded basis through Balochistan Mineral Resources Limited and 10 percent on a free carried basis — and 50 percent is held by Barrick Gold Corporation which is the operator of the project.
As per the estimates, the increase in copper and gold prices has offset the impact of higher project costs, according to the two energy firms. The feasibility study of the project shows it has a mining life of 37 years and is expected to yield 13.1 million tons of copper and 17.9 million ounces of gold.
The project will be executed in two phases, with the phase one having an estimated capital outlay of $5.6 billion that is exclusive of the financing costs and inflation. It is planned to be funded through a limited-recourse project financing facility of up to $3 billion with the remaining funded through shareholder contributions, the OGDCL and PPL said.
The energy companies plan to fund the second phase through a mix of revenue generation from the project, additional project financing and shareholder contributions, if required. Under the updated feasibility study phase one is planned to process 45 million tons per annum (Mtpa) of mill feed from 2028. While phase two is planned to double the processing capacity to 90 Mtpa by 2034.
The project will leverage five of the currently identified 15 porphyry surface expressions within the current mining lease, highlighting substantial future growth potential. Negotiations for the proposed project financing are ongoing.
‘No evidence’ of Pakistan supplying weapons to Ukraine — Russian envoy
- Russian Ambassador Albert P. Khorev praises Islamabad for maintaining a ‘neutral position’ in the Russia-Ukraine conflict
- Russia will ‘consider’ mediating between Pakistan, India under its ‘Eurasian security concept’ if both nations agree, he adds
ISLAMABAD: Russia’s Ambassador to Pakistan Albert P. Khorev on Tuesday dismissed reports about Islamabad supplying weapons to Ukraine in the war against Russia, saying that “no evidence” had been found in this regard so far.
Pakistan’s former prime minister Imran Khan’s was visiting Russian in Feb. 2022, when Moscow launched a full-scale invasion of Ukraine following its annexation of Crimea in 2014.
During the war, reports emerged in the British, United States and Indian media that suggested that Pakistan had sold arms worth millions of dollars to Ukraine in the war against Russia.
“We heard of such reports, such information, but we still haven’t got any evidence so far,” Ambassador Khorev told Arab News in an exclusive interview. “No evidence as of now. So, at this stage, I would prefer to not comment until we have any.”
The ambassador praised Islamabad for maintaining neutrality in the Russia-Ukraine conflict despite “pressure from the Western camp.”
“We are grateful for the Pakistani government for its neutral position in this conflict around Ukraine despite the pressure from the Western camp, previous US administration and European leaders,” he added.
The ongoing Russia-Ukraine war has killed more than 250,000 people, and the US, Russia and Ukraine are currently holding talks in Saudi Arabia to implement a ceasefire that may eventually lead to an end to the conflict.
MEDIATION BETWEEN PAKISTAN AND INDIA
Asked if Russia could mediate between Pakistan and India on outstanding issues, Khorev said Moscow would “consider” the idea if the nuclear-armed South Asian neighbors deemed it appropriate.
Relations between India and Pakistan have been fraught for years with the Muslim-majority Himalayan region of Kashmir being a flashpoint between Pakistan and India since their independence from the British rule in 1947. Both Pakistan and India rule parts of the Himalayan territory, but claim it in full and have fought three wars over the disputed region. Both countries also often accuse each other of fanning militancy.
The idea could be supported by Russian President Vladimir Putin’s new Eurasian security concept, according to the Russian envoy. Eurasia refers to the combined landmass of Europe and Asia including countries like Russia, China, Pakistan India and those in Central Asia, which are of significant geopolitical and strategic importance.
“The Eurasian security concept’s main principle was that Eurasian conflicts should be solved through Eurasian actors which means without influence from abroad, different continents and parts of the world,” Ambassador Khorev said.
Pakistan approves fast-track plan to privatize loss-making national airline
- Cash-strapped Pakistan wants to privatize debt-ridden PIA to reform state-owned enterprises
- Pakistan hopes the restoration of PIA routes to Europe will boost the airline’s appeal to buyers
ISLAMABAD: The government has decided to endorse a plan to fast-track Pakistan International Airlines Corporation’s privatization, state media reported on Tuesday, while reiterating its resolve to offload loss-making public entities from the national exchequer.
Cash-strapped Pakistan is looking to privatize the debt-ridden PIA to raise funds and reform state-owned enterprises as envisaged under a $7 billion International Monetary Fund program secured last year.
The decision to endorse the new privatization plan follows Pakistan’s failed attempt last year to offload a 60 percent stake in the airline, which drew just a single offer that was well below the asking price.
The issue PIA privatization came under discussed at a meeting in Islamabad chaired by Deputy Prime Minister Senator Ishaq Dar.
“Cabinet Committee on Privatization (CCOP) on Tuesday approved a fast-tracked plan for the privatization of Pakistan International Airlines Corporation (PIACL), including the divestment of 51-100 percent share capital together with management control,” the Associated Press of Pakistan (APP) news agency reported.
“The deputy PM emphasized the government’s commitment to PIACL’s privatization to unlock its full potential and reduce financial burden on the national exchequer,” it added.
APP did not provide further details of the revised plan or explain how it would differ from the previous unsuccessful effort.
Earlier this month, the government appointed Muhammad Ali, formerly the special assistant to the prime minister on the power sector, as adviser for privatization.
Last year, PIA got permission to resume operations in Europe after a 2020 ban by the European Union Aviation Safety Agency (EASA), which had raised concerns about the ability of Pakistani authorities and the Civil Aviation Authority to ensure compliance with international aviation standards.
EASA and UK authorities had suspended PIA’s operations in the region after Pakistan launched a probe into pilot licensing irregularities following a 2020 crash that killed 97 people.
Pakistan hopes that the restoration of routes to Europe and anticipated approval for UK operations will boost the airline’s appeal to potential buyers.
