Mir Mohammad Ali Talpur
The Rs 18 billion (US $ 297 million) Saindak copper-gold project in the Pakistani province of Balochistan has been run by a Chinese contractor on a 10-year lease without any independent monitoring for the past three years
Saindak Metal Limited released figures in May this year, as reported by Daily Times, May 11, 2009, that 7.746 tons of gold, 86,013 tons of copper, 11.046 tons of silver and 14,482 tons of magnetite concentrate (iron) worth $ 633.573 million were produced during 2004-08.
There are 32,150 troy ounces in a ton and at the present price of gold at Rs38,319 per tola and $ 1,199.22 per oz as on December 1, a ton of gold would cost $ 38,554,923 per ton and 7.746 tons would cost a staggering $ 298,646,433.558. With silver at Rs1,622 per tola and $ 18.61 per oz, a ton would cost $ 598,311.5 and 11.046 tons would sell for $ 6,608,948.829. Copper is priced at $ 3.162 per lb and $ 6971.017 per ton and 86,013 tons is equal to 189,626,152.086 lbs. So the copper would sell for $ 599,597,892.90. With magnetite at $ 200 per ton, the grand total would be $ 907,749,675.29
A profit of $ 274,176,675.28 would have resulted if these had been sold now. Profits apart, one thing is certain that neither the Baloch in general nor the locals benefited from the $ 633.573 million earned.
The Saindak project in District Chagai in Balochistan 670 km west of Quetta was based on estimated ore reserves of 412 million tons containing on average 0.5 gram of gold per ton and 1.5 grams of silver per ton. It was expected to generate about $ 65 million annually. The 1970s UN-assisted study estimated its worth at more than $ 4 billion.The technology then was comparatively primitive and the prices too have risen dramatically. Copper now stands at $ 3.162 per lb then it was $ 1 per lb. The prices of gold and silver have gone through the roof. So deals based on old estimates make them doubly unfavourable.
The project was revived by Pakistan and China on March 22, 2002, with $ 350 million earmarked for development. The terms are exceptionally unfavourable for Balochistan and its people. MRDL, a subsidiary of the Metallurgical Construction Company of China (MCC) will run it in return for 50 percent of total revenue from mineral sales and also pay $ 500,000 monthly to Pakistan over the next 10 years. Balochistan will receive only $ 0.7 million per year as royalty. These figures expose the total disregard of Baloch rights by the Centre.
Syed Fazl-e-Haider, a respected development analyst, says, “The Saindak saga is also a story of financial mismanagement and administrative mishandling by government planners and economic managers in Islamabad. A project originally estimated to cost Rs 6 billion ended up costing more than Rs 14 billion.”
Syed Sahib in a piece titled, “China digs Pakistan into a hole” (Asia Times, October 2006) had exposed an ominous aspect at this project. He revealed that, “The Rs 18 billion (US $ 297 million) Saindak copper-gold project in the Pakistani province of Balochistan has been run by a Chinese contractor on a 10-year lease without any independent monitoring for the past three years.
Higher-than-anticipated production of blister copper at the site in the Chagai district may reduce the estimated 19-year life of the mine. If the rate of mining continues unchecked, the Chinese contractors will exploit all the resource within the 10-year lease period, leaving no copper or gold for Pakistan to mine from Saindak after the lease contract comes to an end.”
He revealed that, “According to official estimates, the project has the capacity to produce 15,800 tonnes of blister copper annually, containing 1.5 tonnes of gold and 2.8 tonnes of silver. The reported production results, however, have generally remained on average more than 2,000 tonnes per month, which means that more than production of 24,000 tonnes per year has been taking place.
MCC has been given carte blanche and situation remains unchanged. They are as Syed says, “simultaneously the producers and buyers of Saindak copper.” Monitoring is literally non-existent as two non-executive Islamabad-based directors of the Saindak board are responsible for monitoring.
Not only are the reserves being depleted at an alarming rate but also the environment is being irreversibly destroyed. To quote him again, “The smelting of the copper ore emits arsenic and carbon monoxide, which pollutes the air and water near the mines. Most threatened is the atmosphere in the immediate vicinity of the copper mine.”
Presently he is of the view that, “The agreements with foreign firms working in Balochistan need to be reviewed- (and assessment made) whether the project is bringing about a change in the livelihood of the local people or it is creating a mess of environmental degradation?”
Marcel Claude, vice-president of the international environmental group Oceana says, ‘’Gold mining dumps 79 tonnes of waste for every 28 grams of gold, and produces 96 percent of the world’s arsenic emissions.’. A ton has 1,000,000 grams so extracting 7.746 tons would result in a colossal 218,547,857.14 tons of waste, quite enough to swamp Saindak and its environs. The arsenic emissions are a hazardous and noxious gift of predatory mining companies to the world.
Sakura Saunders, Northern editor of www.protestbarrick.net and a director of Prometheus Radio Project, says that the 7.746 tons of gold would result in 15,740,598.8 tons of waste and 11.046 tons of silver would produce 7,482,169.33 tons of waste. Even if extracted from the same ore, the resultant waste would be 15,740,598.8 tonnes. She says these estimates are of ore-body waste, which is the portion of waste that contains many of the toxins, such as arsenic, sulphides, cadmium, etc. It is disaster for the people anyway you may see it.
Surely this piece will prompt accusations that I am against development. I vigorously oppose sale of precious resources of the people for a pittance by corrupt politicians and venal state functionaries and their destruction carried out in the name of development. Projects, which deprive people of their resources and give hazardous waste in return, should be unequivocally condemned and opposed.
The Baloch are continuously being short-changed by the Centre and here the Chinese have joined hands. The resources present at Saindak or Reko Diq are going nowhere if they remain unexploited by Barrick Gold or the equally greedy MCC. All loot in the name of so-called development needs to be stopped forthwith and the voices of the people heeded.
The Saindak Saga amply proves that the Baloch objections and resentment at the unbridled exploitation of their precious resources are justified. They have never agreed to the so-called development and mega-projects and all the supposed development is carried out under the protection of the military or paramilitaries. The Baloch fully understand the negative consequences of these projects to their present and future because it is they who have endlessly suffered deprivation and devastation. They know that the more mega a plan is, the more mega their sufferings will be.
The contributor is a freelance writer. He can be contacted at mmatalpur@gmail.com |
