Islamabad, April 07: The federal government has reaffirmed its commitment to fully finance Phase-II of the Reko Diq project in accordance with the established framework agreed upon with the Balochistan government.
This assurance was given by Petroleum Minister Ali Pervaiz Malik during a visit to Quetta as part of a federal delegation headed by Finance Minister Senator Muhammad Aurangzeb.
The Economic Coordination Committee (ECC) of the Cabinet has recently approved a set of proposals regarding the Reko Diq project, which are currently under negotiation with relevant stakeholders and investors.
During the visit, the Balochistan government, led by Chief Minister Sarfraz Bugti, submitted a comprehensive list of demands.
The federal delegation pledged full support in addressing the province’s concerns. One of the issues raised was the request for a one-time amnesty for the registration of boats, a proposal already submitted to the Ministry of Maritime Affairs (MoMA).
FBR & Exemptions
It was noted that this would require a tax waiver from the Federal Board of Revenue (FBR) and a formal exemption from the federal cabinet.
The provincial government was asked to provide an updated list of approximately 6,000 boats. Upon cabinet approval, FBR will exempt the tax and MoMA will process the case accordingly.
The issue of illegal trawling was also discussed, with concerns raised over large trawlers from Sindh entering Balochistan’s territorial waters and causing significant ecological damage.
The estimated annual loss due to such activities is around Rs 200 billion.
Despite the involvement of several federal agencies and the Sindh government in regulatory roles, the problem persists.
The matter remains on the agenda of the Special Investment Facilitation Council (SIFC), though no concrete solution has emerged yet.
It was agreed that the Prime Minister’s Office will coordinate consultations among federal agencies to establish a cohesive enforcement mechanism.
Read More: More than $60bn Gold, Copper Reserves at Reko Diq
The provincial government also proposed the rerouting of Afghan Transit Trade and imports/exports from Afghanistan through Gwadar Port, highlighting both economic and strategic advantages.
The Ministry of Commerce was tasked with developing a detailed strategy, while the Ministry of Planning, Development, and Special Initiatives will integrate this into Gwadar Port’s operational framework.
MoMA will ensure the port’s readiness for such activities.
Saindak Metal, Balochistan
Regarding Saindak Metal Limited, the federal delegation was informed that Balochistan has been receiving 60% of net profits since 2010, but payments have been suspended for the past two years, resulting in Rs 3 billion in arrears.
The mine has approximately eight years of operational life remaining. The Petroleum Division has requested an extension of the lease for this period.
Though the Balochistan government has expressed interest in taking over management, the proposed conversion of grants into loans has rendered the offer unviable.
It was agreed that the Petroleum Division will release the outstanding payment and the lease will be renewed three days before expiry.
A revised financial model will also be presented to support the province’s management takeover.
On the issue of BMEC (Balochistan Mineral Exploration Company), it was reported that the federal government holds a 10% stake through PMDC (Pakistan Mineral Development Company).
As BMEC becomes more active, this minor stake is creating decision-making delays.
It was proposed that the federal government transfer its shares to the provincial government free of cost (valued at Rs 160 million). With the GoB investing more capital into BMEC, the federal shareholding will automatically reduce, resolving the governance issue.
The Petroleum Division will facilitate the process as needed.
In terms of Reko Diq financing, the federal government reiterated its earlier decision to cover Balochistan’s 15% paid equity in the project to support Phase-II.
Petroleum Minister Ali Pervaiz Malik indicated that the agreement now requires formal approval from the provincial cabinet. Once approved, the federal government will proceed with the financing as per the agreed-upon terms.
Additional matters included Balochistan’s 2.5% share in Margand Block and Block 28 (North). It was decided that necessary regulatory relaxations would be secured to enable this.
Also Read: ECC Approves Reko Diq Project Funding
Regarding payment issues in Jandran Block, the federal government noted that an offer was extended to the province in line with its 2014 policy, but no response was received within the 30-day window, leading to the offer’s expiry.
The lapse was acknowledged by the provincial representatives, who requested a one-time relaxation to ensure Balochistan’s share for both past and future transactions.
The meeting concluded with a decision to accommodate this request to secure the province’s rightful stake.
