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Intellect of our judges and scientists: Riko Diq Project hearings – By Ahmed Iqbalabadi

I had not been following the Riko Diq Project hoo-haa simply for the fact that it was “scooped” by none other than novelist Shaheen Sehbai in The News. Titled “$260 billion gold mines going for a song, behind closed doors” it was another attempt by living in cuckoo land journalists like Shaheen Sehbai to prove their credentials as people who “know it all”. Off course the purpose of the report was to have the matter taken to the Supreme Court, who would play to the galleries and somehow or the other embarrass the government and also force the investor to pack up.

During the last fortnight, the operators of the project, Tethyan Copper Company has printed full page ads in leading newspapers, including Jang and The News to explain their point of view and how much they have invested in the same.  The ads also talk about the potential benefits the development and completion of the project will offer the people of Balochistan and Pakistan.

Intellect personified!

Having not followed it as much, I was surprised to read in today’s Dawn that there is a petition in the Supreme Court against the project!!!  The mover of the petition is the famous Barrister Zafarullah of Watan Party. He is well known for moving petitions in the Supreme Court. The bench hearing the petition includes none other than CJP Iftikhar Chaudhry, Ghulam Rabbani and the formidable Khalil ur Rehman Ramday.

Without going into details of the project, I just want to highlight some aspects of the report:

  1. Samar Mubarak Mand, the famous nuclear scientist, says that “Pakistan is possessed with the expertise and technology to explore and refine the precious metals — an investment which will help the government earn $2 billion per annum”. Can one ask him that if Pakistan has the capability, why haven’t we been able to do it? He has visited the Chaghai area and whitened mountains with a click of a button, how come he never raised his voice about these reserves?
  2. He says that the foreign firm will make a profit of USD 104 billion by digging from the site while in three years they have only dug six or seven sq kms out of total 400 sq kms of leased out area in three years. Can one ask him how he has estimated the profit amount and also in how many years this profit will be made? If they make the profit, how much tax the government of Pakistan will get? How about the royalties? Also, were they required to dig 400 sq kms in one day? There is always a plan to be executed. They aren’t laying a water line that can be dug anytime irrespective of a passing electricity cable or a gas line!
  3. I think there were two top questions, intellectually sound ones asked. First was by Khalil Ramday: “Would we be able to see the face of copper and gold dug out from the site as ores would be taken outside the country in liquid form”. I think he should order CCTV’s installed all over the site and live broadcast be made of extraction of gold in brick form.
  4. Second top most question came from the top most judge of the country: “will the foreign firm also set up downstream industries in Pakistan?”. Can one ask CJP if PSO will venture into oil exploration in Pakistan and OGDC open up petrol pumps? The response of the Tethyan representative was simple:  “We are a mining and exploration company,”

Can one ask who prepares these questions for the judges? I think the judges only read Shaheen Sehbai’s reports.

Another interesting point was the court hinted that they may be interested in listening to TCC CEO, Gurhard Von Borris. I won’t be surprised if the TCC packs up leaves sooner than later.

That would be game, set and match! As for Shaheen Sehbai we beg you: “Tu Shaheen Hay, basera kar paharon kee chatanon par”

Mubarakmand opposes foreign role in Reko Diq

ISLAMABAD, Jan 12: The Supreme Court was informed on Wednesday that the country could earn $2 billion per year by developing the Reko Diq copper and gold project on its own — much higher than a paltry return of $160 million offered to the Balochistan government by a consortium of Chilean and Canadian companies.

“Pakistan is possessed with the expertise and technology to explore and refine the precious metals — an investment which will help the government earn $2 billion per annum,” nuclear scientist Dr Samar Mubarkmand, chairman of the board of governors of Reko Diq Copper Development project, said in a presentation to a threejudge bench seized with petitions challenging a contract awarded to Tethyan Copper Company (TCC) for exploring gold and copper.

The bench, comprising Chief Justice Iftikhar Mohammad Chaudhry, Justice Ghulam Rabbani and Justice Khalilur Rehman Ramday, is hearing identical petitions filed by Barrister Zafarullah and Advocate Tariq Asad. Barrister Zafarullah also moved a contempt petition against the TCC for carrying out advertisements in the print media, although the matter is before the court.

Dr Mubarakmand wondered if Pakistan could develop nuclear technology by reducing defence budget, why could it not develop mining technology. It would also help boost foreign exchange reserves and establish the downstream industry, the scientist said while talking to reporters.

“This technology is similar to uranium mining. The digging process will also help excavate a number of precious minerals, including zirconium and cobalt,” he said, adding that about 400 square kilometres of land had been leased out to the foreign firm, but it had dug only six to seven sqkm over the past three years – only two to three per cent of the total area.

Dr Mubarakmand said that mines in Reko Diq had 0.025 per cent reserves of precious metals. The country, he said, had the capability to process these metals. He said the foreign firm would fetch an estimated profit of $104 billion from the digging site. Right now the firm’s owners wanted to ship the extracted raw mineral outside the country for refining.

The scientist informed the court that the total copper requirement of the country was one ton a year, but whatever copper was excavated from the Saindak copper and gold project had been exported. Not a single kilogram went to the local industry, he lamented.

He rejected allegations that Balochistan was not sharing the project’s feasibility report with the federal government.

Irshad Ali, Director General of Minerals in the petroleum ministry, defended the project and said the allegations levelled by the petitioners were unfounded. “No violation of rules or policy has been breached by the government at any stage,” he told the court.

He recalled that the Balochistan government had in 1993 entered into an agreement with Broken Hill, a foreign company, for exploration of mineral reserves, of which 25 per cent of shares as profit was to go to the province while the federal government reserved the right to levy cess.

On Sept 3, 2007, the then prime minister had constituted a five-member committee comprising federal secretaries to attract foreign companies, but it failed to reach any decision as the firms interested in the project were not ready to give more than two per cent share as royalty while the government’s demand was five per cent.

Dr Zubair Khan, an adviser to the TCC, claimed that a large quantity of precious deposits had been lying idle for years, but these were discovered only after exploration by the company.

“The TCC invested at a time when other investors were running away because of security concerns,” he said, adding that future of the country, especially Balochistan, would brighten only if those bringing investment were appreciated, encouraged and protected.

“The shareholding given to the Balochistan government from the project will be unprecedented.The TCC has already invested $200 million and negotiations for a $1.3 billion loan have been finalised with banks. The total size of the project is $3.3 billion, of which only $1.5 billion is required to develop necessary infrastructure,” the TCC adviser said.

Justice Ramday said that banks would lend the money only after securing interest. Dr Zubair said that everybody would take a big share if the cake was big.

He said that it was a wrong impression that the company would take away ready-made solid gold bricks from the mining site, adding that only a paltry amount of gold which could produce a small gold ring had been extracted from five trucks loaded with raw ores.

“Would we be able to see the face of copper and gold dug out from the site as ores would be taken outside the country in liquid form,” Justice Ramday asked.

When the chief justice asked whether the foreign firm would also set up downstream industries in Pakistan, the adviser replied in the negative. “We are a mining and exploration company,” Dr Zubair said, but added that the company would transfer technology by training the people of Balochistan.

Dr Zubair claimed that the Balochistan government had restrained the company from sharing the feasibility report conducted by a Canadian firm when the chief justice asked whether the TCC had shown the report to the federal as well as provincial governments and the apex court.

The court also hinted at listening to TCC chief executive Gurhard Von Borris on Thursday.

About the author

Ahmed Iqbalabadi

15 Comments

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  • A commenter in Express tribune writes:
    http://tribune.com.pk/story/103120/reko-diq-mines-pakistan-can-earn-2b-a-year-scientist-tells-court

    This article is sheer nonsense! Pakistan does not have the technical expertise to make $2 billion from its resources in Baluchistan. I’ve seen the geological data and there is no way a local company could come even close to doing this.

    Why try to scare away the scarce foreign investment we do have coming in to the country? Its sad that the media joins in into this farce!

  • Hey I think it’d be better to keep Samarmubarakmand out of the loop. His statements are being quoted out of context by the Jang group.

    Being a scientist he talks often about the future ultimate potential ten years on but the yellow journalists would forget to mention it.

    As it is. it’d be best to get the actual statements before commenting on his statements.

  • Send Fazloo Diesel to dig out the gold, copper and ear wax hidden in Pakistan ..He will do Dua and miracle will surely happen. We can also use Mumtaz Qadri to ensure Maulana’s safety…
    We should also have a context between Khuaja Shareef and Iftikhar Chaudhry that who is better looking and suited for a model for Lux soap to replace the dushman-e-EmmaaN Meera!

  • @Saad, this was reported in Dawn while Samar Mubarakmand appeared in the SC!!!! I dont rely on Jang and The News for such sensational news. Problem is that the scientists have no clue about businesses and are willing to give out these big numbers to stay in limelight.

  • Mr. Iqbalbandi,

    It seems you know the business side, right!

    1- Do you have any idea, that only the minimalist’s amount is needed for the heavy machinery; the rest is the human labour, which is in plenty supply in Pakistan? The only thing, which Samar Mubarrakband pointed to, is that they have the capabilities for the mining gain in Uranium explorations in Pakistan, for enrichment.

    2- The estimates for the Gold Reserves are far higher, may be 4 times higher then reported by the foreign firms. They wanted to cheat Pakistan, because who will keep an eye once the exploration started. Secondly, in your wonderful PPP, the Permanent Plunder Party, there is no shortage of the crooks that could be bought for fistful of dollars. After all your party pride itself to be the dons of corruption and sleaze.

    3- I think your gripes are on the issues that yours “Ali Baba” and his 40 thieves would be left without a rich source of income as kick backs and bribes from the foreign firms.

    4- As for the tax on the foreign companies, have you checked their contracts? More likely then not , they will declare their profits in the countries they have registered the companies, therefore, Pakistan will get a big fat O. Secondly, as a practice, they will charge extortionist amount for expenses for their foreigner’s expertise and consultations purposefully dragging the profits down, hence the share of Pakistan will go to even smaller amounts.

    You Plunder’s Party followers are such dishonest people that you will sell the country down the drain, just to keep your filthy and corrupt leaders in power, keep praising them, when inside your hearts you know very well they are corrupt and shameless people.

  • Dear Crank,
    Good to have you back on the blog after a long time. The purpose is not to make you become part of the PPP. The whole purpose of the post was to tell readers the sinister plans of the Teen Jeem alliance.

    Samar Mubarakmand is the one who quoted that there will be profit of USD 104 billion. Can one ask him in what time?

    The point that minimal capital/machinery is required, you got to be kidding me! going to the depths of thousands of feet…need I say more?

    Regarding the taxes, have you looked at their contracts? I have not. But I have worked in foreign oil and gas exlporers in Pakistan. They are taxed on their corporate income and sales. What they are not taxed on is the remittable portion of their incomes like an employee from Italy working in Pakistan, his salary will not be tax deductible. Their dividends are not taxed.

    You have some Allah Wastay Ka Bair with the PPP, which we cant finish. So please keep criticising.

  • @ Ahmed: As if dawn is any better bro.. its the general state of journalism and Dawn is no exception to that.

    @ Crank: Here’s the problem, all these issues are coming up when this government is in power.

    The Riko Deq deal was an absurd one in which Pakistan was getting nothing but when Baloochistan government decided to revisit it and enter into a new one you got Supreme Court intervening.

    The sham judges suddenly have problems with deals being done by this government at a better rate than the previous one, may I know why? The Gwadar port, PTCL and KESC all given at throw away prices along with the Reko Diq but when this government revises it to a better one Iftikhar Chaudry wants the best one, perhaps he’s not getting his cut.

    The judges would do well to look into the endless corruption in privatization deals in the previous government.

    The Reko Diq is a provincial matter not a national one, as such the Supreme Court should keep it nose out of the matter.

    It might be a corrupt deal or not or whatever, but I’m all up for filling the pockets of the corrupt feud of Balochistan if that is what it takes to keep them with us until the situation in general and economy in particular stabilises.

  • actually all these so called scientist wanna make big money out of this project and if control of mining is in the foriegn hands then there corruption would be affected , this is also one of the reason that they are twisting many facts

    Yeh sab khannay waly log hein, research kay naam par universities or research institutes mein arbon rupay ka ghaban kartay hein

    But media never pay attention to that,ask any fellow in the research institute he will tell you how these guys do corruption from instrument purchasing to the research project..most of the grant which they get is wasted and there is no solid output in research from Pakistani universities and research centers

    No scientist mafia is looking to make big money in Riko dek project as well…

  • correction of typing failure

    Now scientist mafia is looking to make big money in Riko dek project as well…

  • i would personally believe much more estimations given by foriegn companies, in our country speculations and estimations and most of times not very careful..foriegners (europeans) are much careful in their estimations..

  • Its a shame that the company did the exploration, took the risks to find out whats hidden within thousand of miles in earth…. now Pakistani Government come in to eat halwa off their research…..Any business pecially the mining companies take big risks by spending millions.. and they would want to be rewarded for the risk taking for a certain number of years…

    By these political and legal dramas, no one in future would come in Pakistan to explore and invest. If Saudi Arabia made these kind of Issue at the time of oil explorations in 70s… they could still be living on just hajj income.

  • corruption taqreeban her satah per maujud hai is mulk mein … magar is PPP hakumat say koi bazi nahi lay ja sakta corruption kay mamlay mein… awam kay paas to yeah he choice reh jati hai kay kis ki baat ka bharoosa karain aur kis ki nahi
    ab us party pay bharoosa karnay say rahay jin ko “good governance” karna door ki baat shayayd is ka matlab bhi nahi aata, jin kay minister corruption ko apna haq samajhtay hain, jin ko khud to kabhi tax dainay ki taufeeq nahi hoi

  • Look at khalil rehman ramday who always preach morality to everyone in court. He is a retired judge who is holding on to his post when he should leave that post for some other deserving judge. He is a junior judge, because per rule all adhoc judges are junior judges but he is on the bench with CJ on every important political case. Other judges are senior to him now they should be on bench not him. This is immoral act of him to block some other judges’ promotion to SC because he is sticking to that post although he is retired. Where are his principles which he teaches other people in court? He got 2 plots and he asked for second plot few days before NRO case because he knew govt will be under pressure coz of NRO CASE.HIS SON MUSTAFA RAMDAY GETING ALL IMPORTANT CASES FROM GOVT OF PUNJAB N GETTING GOOD MONEY FOR THAT.

  • RimJhim & crankthatskunk

    When you talk hyperbolic spitting fire about a certain party, even if you do make a valid point, you are likely to be dismissed – because you have shown bias
    *preaching over*

    Every company that comes to mine does it for profit motive. This isn’t a charity project. Question that would this profit go to Pakistan? It will in case of Royalties – It will also have a way of allowing people employment – who are taxed as well as who are now contributing members of society.
    Pakistani corporate sector, as compared to our Indian counterpart, has been in shambles. We have hardly any world leaders, and one of the reasons for this is that we have no concept of long term customer trust.

    In that case, you can either have foreign companies or invest in it through public companies. Our public Companies are already making losses, due to our crème de la crème Bureaucracy and Military

    Only realistic prospect is a foreign firm – alternative (which I have a feeling many do want) is that no extraction ever takes place

  • Dr. MM might be very capable person in his own field but he does not know any thing about mining and mining economics. he also made a statement that it does not matter whether we produce one ton per day or one thousand tons/day of ore. If this statement were true then there would be no need for any engineer working on optimizing a mining project in the world.