“Nine months ago during my election campaign, I promised the people of Chiniot that a Pakistan Muslim League-Nawaz government would exploit and utilise the iron ore reserves of the area, creating jobs for tens of thousands of people. That promise has been made good today,” Chief Minister Shahbaz Sharif said at a ceremony to sign the contract for a steel mill at Chiniot on Wednesday.
The mill would be the first of its kind in Pakistan in that it will excavate the iron ore it will use to produce steel products.
The ceremony for signing an agreement regarding Chiniot, Rajoa Iron Ore Project between the Punjab government and the Metallurgical Corporation of China was held in Chiniot. The chief minister gave a formal go ahead to the project and was also the chief witness to the contract. Metallurgical Corporation of China (MCC) Overseas Business Department Director General Xu Youngjie and Punjab Mineral Department Secretary Dr Arshad also signed the contract.
The Punjab government has announced that the MCC will submit a report on an estimate of iron ore reserves in Chiniot and Rajoa in 18 months. After the report is released, the government will lay the foundation of the steel mill which will produce products using iron ore excavated from the area. The mill will not only provide jobs to an estimated 100,000 people, but also provide iron ore to the Pakistan Steel Mill in Karachi (which presently imports the iron ore it uses).
Around 10 years ago, the Punjab Mineral Department Corporation had discovered large deposits of iron ore in Chiniot and Rajoa. The current estimate of iron reserves is tens of thousands of tonnes. The government says that the quality of iron ore in this area is similar to the quality of iron mined in Brazil, Russia and India.
Sharif said China was one of Pakistan’s most trustworthy friends. He said the country was planning to invest up to $32 billion on various projects in the country. Saudi Arabia’s gift of $1.5 billion was also one such gift that spoke of the trust Saudi Arabia had in Pakistan’s leaders. “Even though the Punjab is not self sufficient in oil and gas, its iron ore reserves might help the province even the scales,” he said.
He said the steel mill would be able to fulfil the iron and steel requirements of the country and earn Pakistan export revenue. The chief minister requested the Chinese delegation to try to complete the project in 10 months so that the process of establishing the mill could be expedited.
“In 2007, the Punjab government, awarded the contract for exploiting iron ore in Chiniot-Rajoa to a fraudulent company registered in the USA,” the chief minister said. Sharif said when he became chief minister in 2008 he ordered a probe into the contracts awarded by the previous government. The probe revealed that the Punjab Mineral Department Corporation had awarded that company a contract without allowing other companies to bid for it. He said he had had that contract cancelled because of a lack of transparency. The company later approached the Lahore High Court challenging the cancellation and obtained a stay order. The issue remained pending in court for three years. Sharif said he personally requested the LHC to announce its decision “as it was high time the project started”. The chief minister said the court had upheld the government’s decision.Punjab Mineral Development Corporation Board Chairman Dr Samar Mubarakmand said the iron ore project will pave the way for the opening of several industries in this area. He said Chiniot was rich in resources that should be utilised.
Minister for PMDC Chaudhry Sher Ali said the company will investigate the quality of iron ore which will be used for the steel mill. He said Chiniot had rich reserves of iron and copper and the steel mill belonged to the people of Chiniot.
MCC Director General Xu Youngjie thanked the government for awarding it the contract and said the MCC will finalise the report on iron resources in 18 months.
Published in The Express Tribune, April 3rd, 2014.