ISLAMABAD: The World Bank’s arbitration court granting Pakistan a stay order of six months in the Reko Diq mine case was a “great relief,” chairman of the China-Pakistan Economic Corridor said on Friday.
Last year, the World Bank’s International Center for Settlement of Investment Disputes (ICSID) ordered Pakistan to pay damages of $5.8 billion to Tethyan Copper, a joint venture between Chile’s Antofagasta Plc and Canada’s Barrick Gold.
Reko Diq is a small desert town in Pakistan’s southwestern Balochistan province, known for its vast mineral wealth.
“Reko Diq:Stay order by World Bank tribunal on $ 6 Bn award vs Pakistan is great relief,” Gen Asim Saleem Bajwa, who heads the CPEC authority, said on Twitter.
“Meanwhile PM directs to fully support GOB [government of Balochistan] for accelerated dev [development] of mineral sec [sector] in a transparent manner,structured system, best tech,involve local investors,develop own HR [human resources].”
Reko Diq:Stay order by World Bank tribunal on $ 6 Bn award vs Pakistan is great relief.Meanwhile PM directs to fully support GOB for accelerated dev of mineral sec in a transparent manner,structured system, best tech,involve local investors,develop own HR #PakistanMovingForward
— Asim Saleem Bajwa (@AsimSBajwa) September 18, 2020
“This is a success for Pakistan and its legal team,” the Pakistani Attorney General’s office said in a statement on Thursday.
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.
State-run companies from resource-hungry China have long coveted Reko Diq and more recently Saudi Arabia has shown interest, officials say.
But the Reko Diq dispute has also 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.
Tethyan Copper discovered vast mineral wealth more than a decade ago in Reko Diq, at the foot of an extinct volcano near Pakistan’s frontier with Iran and Afghanistan. The deposit was set to rank among the world’s biggest untapped copper and gold mines.
The company said it had invested more than $220 million by the time Pakistan’s government, in 2011, unexpectedly refused to grant them the mining lease needed to keep operating.
The World Bank’s court first ruled against Pakistan in 2017 but fixed damages in 2019.