New Reko Diq project to attract investment, Supreme Cold told

ISLAMABAD: The Supreme Court was told on Monday that the new Reko Diq project will open doors for foreign investment besides promoting political harmony among the past and present governments. 

A five-member larger bench of the apex court, headed by Chief Justice Umer Ata Bandial and comprising Justice Ijazul Ahsen, Justice Muneeb Akhtar, Justice Yahya Afridi, and Justice Jamal Khan Mandokel, heard the Presidential Reference regarding the new Reko Diq Project.

Amicus curie Zahid Ibrahim, while arguing before the court, submitted that the Khyber Pukhtunkhwa government made legislation in 2017 on mineral exploration, adding that based on KP legislation, it can be said that the province can only make amendments for mines and minerals under the Regulation of Mines, Oil Fields, and Mineral Development (Government Control) Act, 1948.

He submitted that the new Reko Diq project will attract foreign investors and promote political harmony between the past and present governments. He submitted that the joint venture was earlier made by the previous government, and the present government is continuing it in the interest of the country and the province of Balochistan.

Salman Akram Raja, another amicus curiae, submitted that the amendments made by the Balochistan Assembly could be considered timely legislation. He submitted that the 1948 Act regarding mines and minerals is both federal and provincial, but added that the amendments made to the Act are against the scheme given in the Constitution.

He submitted that except for oil and gas and nuclear energy, the provinces should make legislation for other minerals. Justice Yahya Afridi said that it would be better to keep the Regulation of Mines and Oil-Fields and Mineral Development (Government Control) Act, 1948, in its original form, adding that provisions related to the federal nature should be examined by the federal government and the provisions about provinces should be examined by the provincial governments.

Makhdom Ali Khan, counsel for Barrick Gold Corporation, submitted a concise statement regarding Section 7 of the Regulation of Mines and Oilfields and Mineral Development (Government Control Act 1948).

He submitted that the Balochistan Assembly had amended the Regulation of Mines and Oil-Fields and Mineral Development (Government Control) Act, 1948 (“1948 Act”) through the Regulation of Mines and Oil-Fields and Mineral Development (Government Control) Amendment Act, 2022 (“Amendment Act”), adding that this provided the legislative basis for a negotiated agreement about the Reko Diq Project.

Concerning the act as a stand-alone statute, he argued that there is a presumption in favour of constitutionality and that law must not be declared unconstitutional unless it is placed next to the Constitution, and no way to reconcile the two can be found.

He submitted that there is no question of legislative competence concerning the amendment. Section 7 allows the provincial government to enter into a negotiated agreement for minerals under its legislative competence.

“There is no encroachment, incidental or otherwise, into the enumerated federal legislative fields of mineral resources necessary for the generation of nuclear energy, mineral oil, and natural gas,” Khan submitted, adding that the amended act can, therefore, be considered a stand-alone statute and encroachment, if any, by the 1948 Act is incidental.

He contended that it cannot invalidate the amended act under Article 143 of the Constitution as such encroachment stood removed on the enactment of the amended act, 2022, and added that any references to the 1948 act within the amended act can also be considered incidental and only for identification of the statute.

Makhdom Ali Khan submitted that the constitutionality of the amended act does not rest upon such markers of identification, adding that the 1948 Act is both federal and provincial, with both legislatures exercising legislative authority in their respective spheres. This type of enactment is one of several that cannot be strictly allocated solely to the federal or provincial domains.

He further submitted that even if the 1948 Act is regarded as exclusively a federal statute, the amended act will survive as an independent stand-alone provincial enactment given exclusive local legislative competence, and encroachment by the 1948 Act in such incidental areas will be removed by it.

The counsel submitted that it is preferable to treat the 1948 Act as a hybrid statute, adding that such an interpretation also respects the constitutional division of legislative competencies.

This approach, he submitted, is also by the presumption of constitutionality that attaches to statutes. Every effort must be made to find constitutional laws. He further submitted that both the parliament and the provincial legislatures have to date operated in a manner consistent with this approach.

Most specifically, he submitted that parliament amended the 1948 Act in 1976, but only to the extent of issues pertaining exclusively to petroleum. Similarly, he contended that Section 105(1) of the Khyber-Pakhtunkhwa Mines and Minerals Act, 2017, provides that the 1948 Act is “repealed to the extent of mines and mineral development in the province of Khyber Pakhtunkhwa.”

Likewise, he submitted that the Sindh Statute excludes mineral oil, natural gas, and substances for the generation of nuclear energy, but the repeal is of the 1948 Act to the extent of the province of Sindh. Meanwhile, the court adjourned the hearing for Tuesday (today).