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Reko Diq gold/copper project imminent coverage
Decision on Barrick/Antofagasta 3.3 bn Reko Diq gold/copper project imminent
The province of Baluchistan in Pakistan, located next to thge borders of Iran and Afghanistan is now expected to decide on issuance of Reko Diq copper/gold project mining lease next week.
Author: Gul Yousafzai
Posted: Thursday , 26 May 2011
QUETTA (Reuters) -
Pakistan's Baluchistan province is expected to decide on issuing a mining lease for a $3.3 billion copper and gold project owned by Chile's Antofagasta (ANTO.L) and Canada's Barrick Gold (ABX.TO) next week, officials said on Thursday.
The two companies are partners in the Tethyan Copper Co (TCC) joint venture, which has a 75 percent interest in the Reko Diq project in the southwestern province, and hold the exploration licence for the site.
Reko Diq holds an estimated 5.9 billion tonnes of mineral resources with an average copper grade of 0.41 percent and an average gold grade of 0.22 grams a tonne, according to data released by Antofagasta.
The TCC says it has the right to mine at Reko Diq under Baluchistan's 2002 Mineral Rules, but the provincial government last year warned that it would cancel the project amid growing anger over outsiders exploiting natural resources in Pakistan's biggest but poorest province.
The Pakistan Supreme Court had barred the Baluchistan government from giving approval for the Reko Diq mining lease until it rules on an investigation over the awarding of the concession to TCC.
But on Wednesday, the Supreme Court allowed the provincial government the right to decide on the granting of the lease. The court investigation will continue.
"We have called a meeting in the first week of June. The representatives of TCC will also be invited ... to renegotiate the issue," chief secretary of Baluchistan Ahmed Bakhsh Lehri told Reuters.
"We want them to set up their refinery here. We hope that the government will take the decision by next week."
TCC was granted the exploration licence for Reko Diq in 2006.
Separatist guerrillas in Baluchistan on the border with Iran and Afghanistan have been fighting a low-level insurgency for decades for control of the provincial gas and mineral resources, which they say unfairly exploited by the country's richer and more powerful provinces.
(Writing by Zeeshan Haider)