Though Pakistan
A cursory glance over the country’s natural resources shows that it has abundant coal reserves. Its biggest coal-field at Thar has an estimated 1.75 billion tons of lignite coal, which can reportedly generate 50,000MW of electricity and 100 million barrels of oil annually for over 400 years. In addition to Thar, the country possesses substantial coal reserves in other regions, which can also be exploited for producing energy or put to other commercial uses. But, despite all the rhetoric during the last 14-15 years, the country has not been able to mine the ‘black gold’ and exploit this nature’s gift for meeting its energy needs and save about US$15 billions which it presently spends on importing petroleum products.
No doubts, of late, the government has started works on a US$150 million pilot project to produce 100 MW electricity from Thar coal, through environmentally safe underground coal gasification (UCG) technique, and it intends to increase the electricity production from this resource to 1,000 MW with in five years. But, the government is exploiting only one block, while Thar coal-field has eight blocks and each of these needs to be exploited expeditiously.
In addition to coal, Pakistan has some 117 types of marble and granite, stretching from Las Bela (Baluchistan) to Siachin (Northern Areas), whereas our neighboring countries have less than 20 types of stones, but our current granite exports are less than the export of both China and India
Likewise, the world's second biggest gold and copper reserves at Reko Diq, in Chaghai (Baluchistan ), also remain to be exploited. Spread over a vast area, according to Dr. Samar Mubarakmand, these reserves can yield gold and copper worth 1,000 billion dollars, but for one reason or the other we have not been able to benefit from these vast reserves so far.
Reko Diq copper and gold field has 20 blocks, one of which EL-5 was licensed to BHP in 1993, but that company did not give any tangible results. However, when global mining leaders Barick Gold and Antofagasta PLC fully acquired the Tethyan Copper Company, along with the exploration license for EL-5 in 2006, they made an investment of US$220 and brought the project to life. In August, 2010, this entity also submitted a bankable feasibility study to the government. However, commercial exploitation of these precious metals remains a distant dream despite lapse of 15 months and that too in a period when the country badly needs funds to bring down its huge budget deficit.
The fact that the National Mineral Policy of 1995 has not been revised so far speaks volumes about the government apathy towards this sector. Furthermore, though coal, gold, copper, zinc, marble and granite deposits were discovered long ago, Pakistan's mining and quarrying sector continues to depict a dismal picture due to lack of commitment, vision and focused approach.
For want of concerted efforts to reap windfall profits from the nature's bliss and create in the process hundred thousands of new jobs, the country’s national economy remains in tatters. Take the case of Thar coal. Despite the entire hullabaloo during the last 15 years, work on even the infrastructure projects has yet to start. No doubt, building infrastructure is both costly and time consuming, but bureaucratic wrangling is one of the major reasons for slow progress.
For instance, in 2010, the sindh government had estimated that the development of a road network, building of water supply schemes and effluent disposal facilities, lying of electricity transmission lines and provision of a railway network would cost US$1.14 billion over the next five years. However, there is a realization now that it might not be possible to raise such huge sums of money at a time when the world is facing recession. This has led to the remodeling and redesigning of several infrastructure projects.
Tariff issues for the electricity generated can also create more delays. Ironically, a Chinese group - Shenhua Group - abandoned, some four years back, after spending US$100 million on feasibility studies when the former and WAPDA could not agree on the Tariff for electricity to be produced. The group demanded 5.67 cents per kWh while WAPDA insisted that it could not be more than 5.39 cents per kWh.
As regards Reko Diq, now that the project has materialized by the efforts of a foreign investor, we are hearing unfortunate versions from supposedly responsible figures that the government should dishonor its contract with the foreign investors. It must be noted that the foreign investors in the Reko Diq project not only revived a dead project but invested into our non-existent mining sector in times of high security and economic turbulence when foreign investment had become extremely shy.
It must be kept in mind that the initiation of work on Reko Diq project can firmly place Baluchistan on the global mining map, attracting huge inflows of foreign direct investment and launching of many more projects the likes of Reko Diq. This will strengthen the national economy in general and that of Baluchistan province in particular. But this would be possible only when investment policies are fair, investor-friendly and the state contracts are fully honored.
In short, for one reason or the other, these natural resources remain to be exploited and tapped, while the people continue to face energy shortages, unemployment, inflation and poverty, and the country burdened with bulging debts, revenue shortfall, deterioration in infrastructure and worsening socio-economic conditions.
At a time, when the country is facing an economic crunch and it was unable to pay substantial amounts, running into billions of dollars, on laying the infrastructure and preparing the mines for commercial exploitation, the best course for it would be to lease out some blocks to the private sector on public-private partnership basis with conditions that the entire processing would be done in Pakistan and the mines would be handed over to the government after a fixed period of time.
Meanwhile, when our people acquire the necessary expertise and the financial position of the government eases, it may start mining some of the blocks in the coal, granite, copper and gold fields, if it can ensure efficiency and transparency in running these vital projects and these do not become a burden on the national economy like the Saindak Gold Project (when it was a public enterprise) and other state enterprises.