An arbitration tribunal of the World Bank’s (WB’s) International Center for Settlement of Investment Disputes (ICSID) rejected Pakistan’s final defense against liability and ruled against Pakistan in relation to the unlawful denial of a mining lease for the Reko Diq project in 2011.
On Tuesday, ICSID confirmed that Pakistan had violated several provisions of the bilateral investment treaty with Australia, where Tethyan Copper Company Pvt Limited (TCC), as announced by Chilean mining company Antofagasta.
“We are pleased with this decision and now the damages phase of the arbitration can begin. We expect that, at the conclusion of this phase, Tethyan will receive an award entitling it to the fair market value of the project at the time that the mining lease application was denied,” said Antofagasta Chief Executive Officer in a statement.
TCC is a joint venture between Barrick and Antofagasta who filed arbitration claim against Pakistan.
Pakistan is expected to pay a huge penalty as the Arbitration Tribunal has to start its proceeding from March 22 (today) in which it would assess the damages that are to be paid by the country.
Though Pakistan is worried over it, however, still confident as chances still exist to avoid huge penalty.
In 2011, the government of Balochistan refused to give mining license to TCC for the Reko Diq gold-cum-copper project.
Later, in 2013 the three-member bench of the Supreme Court, headed by then chief justice Iftikhar Muhammad Chaudhry, declared the agreement null and void.