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III-4
MINERALS
Objectives and Strategy has potential,yet its role in the economyof Pakistan The mineralsectorhasconsiderable can play a vital role in the exploitationof national remaineddeficient. As mineral resources (1993-98), calls for enlargingthe role of this sectorin endowmentthe Eighth Five Year Plan require specialattention resources, the economyof the country; Minerals, being noR-renewable of geologicalmapping, The role manner. optimal so that theseare exploitedand utilizdin an mineral prospecting,exploration,mining and utilization is of spegialimportance. The Eighth Plan envisagesvigorous and sustainedefforts for the discovery and 2. In of mineral resources. and scientificallyplannedmanagement explorationof mineral deposits will be given to:this contextemphasis i) of the Speedy completionof geologicalmappingof the mineralizel ar:eas country; to discovernew deposits; adoptionof modernexplorationtechniques intensification of detailed exploration and evaluation in the known both laterally and at depth; their extension mineralizedzonesto delineate to mineralexplorationusing of multi-disciplinaryapproach strengthening geochemistry and drilling; imagery,geophysics, photogeology, satellite of geologicmodelswhich would lead to improvementin the preparation genesis of the mineral resources; of the a better understanding improvement and clarity in regulatory and fiscal regime for mining investment; Privatizationof Public SectorMines; I

ii) iii)

iv)

v) vi)

vii) viii)

Foreign Direct by encouraging Acquisitionof modernforeign technology and in the mining technologies; of the firms experienced Investment protectivemeasures. of environmental monitoringof implementation

ix)

The major priority areasin the Eighth Plan are:i) for which Policy will be announced The National Mineral Development federal relevant with the prepared consultation in be Plan will an Action

202 Ministries, provincial Governments,banks and internationaldonor agencies. ii) The GeologicalSurvey of Pakistan(GSP) would set up an Economic Evaluation Division to generateand interpret geo- scientific and test mining data on areas of economic interest for the preparation and dissemination of feasibilityreports. The selectionof Areas to be includedin the GSPprogrammewould be in accordance undertakenin consultationwith provincial Governments with the spirit of the National Mineral DevelopmentPolicy and other reports preparedby local and foreign consultants.The identification of areaswould be priorittzd as under:a) mainly suchmineralswhich havea goodchanceof beingexported investors; as well as assumed to be attractivefor prospective Secondlysuch mineralswhich might be producedand consumed locally, therebyreplacingimports; and finally generalproductionpotentialof mineralsusedand available locally.

iii)

b)

c) iv)

v)

Reportson areasof GSPwould prepareandpublishEconomicevaluation smaller areasfrom regions to economicinterest covering succeedingly mineral bearing tracts of such size which are suitable for commercial explorationnentures. Provincial Governments may tenderout prospective areasto the private sectorbasedon the feasibility reports issuedby GSP and also provide services on reasonable charges and equipment to the Private Sector. Mineral Concession rules would be made development oriented, transparentand firm by streamlining the procedures, reduction of administrativediscretion, deleting the anti-commercialprovisions and that curb the developmental other conditionalities activities. A package of fiscal incentivesregardingexemptionfrom levy of custom duty on import of mining machitrery,import permit fee, tax holidays, mark-uprate andprovisionof soft exportfinancescheme at concessionary Corporationwould term line of credit to RegionalDevelopment'Finance be introduced considering its complex, risky, capital intensive and period. heterogeneous natureand long gestation Provision of technology and technical services to small scale mine operators will be institutionalized.

vi)

vii)

viii)

203 ix) The National Centre for TechnologyTransfer would be utilizd for obtaininginformationand advisoryservices in the selection,acquisition, absorption of technology adoptionand to the mineral sectorand end-user andjoint ventureagreements. servicefor negotiation mineralbased industries To encourage andthe projectswhich haveexport provincial governmentswill give priority to import the or substitution, leaseapplications for mining. will setup a serviceunderan appropriateagencyfor low cost Government rapid mineral analysisand beneficiationtesting for the benefit of private mine owners. Equipmentrentingand leasingenterprises will be established to promote mechaniratton in the mining sector. Training facilities will be enhanced for producing trained specialistsand middle line supervisors in all geo-scientific disciplines Foreign investment in the mineral sectorwill be encouraged. Public Sector projects which are in production or close to it will be transferred to private sectorgraduallyandin phases. Mining projectswill qualify for foreign suppliercredits for purchase of guarantee mining equipmentagainst of federal Governmentsubject to insurance of specifiedrisks. Financing of miningprojectwill be throughescrowaccounts. Possibility of usingMining leaseand mineralreserves as guarantee for the extension of loan/credit dependingupon the risk of the stage at which loan is requiredwould be investigated.

x)

xi)

xii)

xiii)

xiv) xv)

xvi)

xvii)

xviii) Creationof specialexplorationfund for financialassistance to companies in prospecting/exploration engaged in priority areaswill be investigated. xix) Creation of conditions and environment conducive to private sector investment; and Conservation of mineral resources and protectionof environmentwould be an importantobligationof investorsin mining project.

xx) Management Issues

4. Although adequate prospects mineralization are expecM in Pakistanas is evidentfrom its geologicalset up, yet its contributionto economyis merely l% of GNP. It is mainly due to

204 the nature of this industry which is extraordinarilycomplex involving long gestionperiods, heavycostsand high risks. Other problemsbeing facedby the Mineral Sectorare insufficient R&D facilities, lack of equipmentand infrastructure,nongeological mapping, inadequate problems,NationalMineral Development availabilityof risk capitaletc. In order to resolvethese and NaturalResources by the Ministry of Petroleum Policy and Action Plan will be formulateid and Privatesector. in consultation with the relevantFederalMinistries, ProvincialGovernments environment that would Implementation of proposedAction Plan will createan appropriate encourage both the public andPrivatesectorto takeactivepart in the identification,exploitation and processing of the mineralresources. ResourceBase work has Even thoughthe geologicalsurveyof the country is inadeqmb, considerable 5. and beenin identificationof mineralzones,which envelopmostimportantmineraloccurrences investigations,the group of potential of the country. As a result of detailed geo-technical self sufficientare: rock salt, gypsum,baryte, mineralsfor which the countrycanbe considered rnarble, onyx, soapstone, silica sand, lirnestone,dolomite and ornamentalstones.Mineral de,posits which are promising and merit detailedgo-scientificstudiesfor determiningtheir geological include:copper,gold, silver, reserves to havesizeable economic viability andappears bauxite, antimony, chromite, platinum and platinum group, iron ores, zinc, lead, magnesite, fluorite, tungstone, lithium, gemstones, rire earths,gold in motherrock in the bedsof Indus river and its tributaries. Mineral Devehpmentin the Private Sector is minimal. Privateminingenterprises 6. Privatesectorinvolvement in mineraldevelopment are small units, ill organized,fragmented and wastefulin their methods.They are extracting mostof the deposits naturethat occur on or nearthe surfacethrougheitheropen of non-metallic pits or underground are confinedto outcrop mining to shallowdepths.Most of theseoperations Yet, working and are abandoned limits reached. their contributionin volume are when their termsis substantial. 7. Despitetheselimitationsthe privatesectorhasthe potentialto makea major contribution to the mineral sectorprovidedappropriate institutionalarrangements and facilities are created. Various physical facilities suchas availability of geologicalmaps, explorationand evaluation data,techno-economic informationon variousaspects of mining areavailablefrom the Geo-Data Centre of the GSP. Furthermore, chemical aralysis, mineralogical tests, and material beneficiation areprovidedthroughthe laboratories of PCSIR,RDC, technical organizations, and academicinstitutions.Additionrlly, extensiveefforts will be madeduring the Eighth Plan to supportthe private entrepreneur to modernize and balancehis operations. Infmstructure Faciliry 8. In Pakistan, economically viableminerals underdeveloped, are foundin inhospitable, and power or water supply. Saindakcopperore, under populatedareaswith little communication, Nokkundi iron ore and HazaraPhosphate rock are a few examples.The costsof building the

205 are so high that evenmajor projectscannotabsorbthem. During the Eighth Plan, infrastructure will providethe infrastructure in thi miningareason the Federaland Provincialgovernnients priority basis. a Foreign Direct Investment g. The acquisitionof technology and expertise by Pakistan and foreign participationin the within an overall frameworkof NationalMineral Policy and mining sectorhasto be considered Foreign Private Investment Policy. The policy should attract such private foreign investment/jointventures which ensure acquisition of latest technologyfoi mineral sector development. Landmarks of Eighth Plan 10. The following key programmes/projects in the Public Sectorwill be undertaken during the 8th Plan period:Geohsical Sumeys In additionto regionalgeotogical mapping to the scaleof 1:50,000,Geological surveyof Pakistan(GSP)would undertake the tasksof prospection and primary in following exploration the metallogerric zones selectedfor 10 year National Mineral ExplorationProgramme by mineralconsultants M/s GMBH of German hired by the Asian Development Bank. L. AreaChilas Uhmmafic-Mqfic RockComplex- Northern Areas The Chilasrock body with indications of Platinum,Platinum-group elements and chromite occurrences belongsto the largestbasic intrusionsin the world which arecontinuously exposed. It is approximately 300Km long between NangaParbat in the eastand the Dir District in the West. It is considered as the root zoneof the KohistanIsland Arc with its deepest part in the Chilasarea.

Area-2.

Jijal Ultmmafi,c-Mafic Rock Complex- NWFP The Jrjal rock complex with also indications of Platinum, Platinum-group elements andchromiteoccurrences is well exposed between Jljal and Patan,Allai Kohistan.It coversabout200 Sq. Km. It represents an up thrustedrock complex againstrocks of the Indo-Pakistan Plateto the south.

206 Area-3. gla llltrumafic-Mafic RockComplex(Dargai Complex)- NWFP Sak"hakot This rock complexis situatedin MalakandAgency, west of Dargai. It is about 26 Km long and3 Km to 6 Km wide. It bearschromite,Platinumand Platinum200 Sq. groupelements. investigations coversapproximately The areafor detailed Km. Area-4. PolymetatticMineralization Chitrul, Verit (Awerith) The Centerof this areais locatedabout25 Km north of Chitral, within a cluster of gold, Silver, copper lead, antimony, and strontium occurrences/deposits. for detailedinvestigations. Approximately160Sq. Km are selected Area=S. Polymetallic Minemtirntian Chitral, Drosh - NWFP The center of the Drosh area lies 25 SSW of Chitral. This area has been identified for detailed investigationscontaining cluster of copper, lead and antimonywhich coversapproximately160 sq. kms. Area-6. BeIaand Teftiary Sediments, Minemtized Carbonates OphioliteBeh, Jurassic Duddar-Kundi - Balochistan The area with Copper, IJad, Silver, Zinc, Chromite, barite, magnesite,talc or depositscovers more than occurrences bauxite and low-grade phosphates for 12,000 Sq. Km. Out of these,about 4,000 Sq. Kms have been selected s. detailedinvestigation Area-7. Ktuzdar - Batnchistan JumssicMineralized Carbonares, Out of the areaof morethan 16,000Sq. Km with Iread,Silver, Zinc, Bariteand Iron mineralization,about 2,000 Sq. Km. have been selectedfor detailed investigations. Area-8. Igneous-ContactMetasomalicGold-BearingIron Ore, Chiniot-Bangla - Punjab Ridge where The areacomprises about300 Sq. Km coveringparts of Sargodha Precambrianrocks of the Indian Shield are exposedwhich containsiron/gold mineralisation. Area-9. - Balochistan Chagai Magnatic Arc, Chagai-:Dalbandin-Rasluh Sq. Km with Copper,Iron, Gold, vermiculite and Out of theareaof about10,500 only marble depositsor occuffences,approximately5,000 sq. Km have been selected for detailedinvestigations.

207 Area-10. Saindak Poryhyry Area, Saindak-MashkiChah-Nol*undi - Balnchistan or occurrences of Iron, about 15,000sq. km, with deposits This areacomprises and onyx marble.About 6,000 sq. km are Gold, Silver, Copper,molybdenum investigations. for detailed chosen Area-l1. (Ihmmafic-Mafic-BasaltRock Complex, M usbmbagh-Zhob Vatley-,Balochistan Khanozaiin the south This rock complexcoversnearly3,200Sq. Km between near The areafor detailed Muslimbagh. in the north, centered Fort Sandeman zurd coversabout talc, vermiculite) investigations of Platinum,Chromite,magnesite, Km. 1,600 Sq. Area-12. Precambrinn-PaleozpicTeftiary, Abbofrabad, Mansehra; Muznffambad NWFP,NAK of anddeposits Occurrences of gold, silver, copper,leadand iron mineralization phosphate,magnesite,talc, glass sarrdand bauxite are known. The area for coversabout400 Sq. Km. detailedinvestigation Area-13. Tnne, SwaI- NWFP Suture Associnted Gemstone The area is associated with the Indus suture zone,markedby the Main Mantle Thrust in SwatDistrict. The areacovers250 Sq. Kms. for detailedinvestigation belt of talc-chloriteschists. along the emerald-bearing Area-14. Tnne; Hunzn - Northem Areas Suture Associated Gemstone The zone is markedby the Main KarakoramThrust and extendsfor more than About 350 Sq. Kms are selected 100Km from the Hunravalley to Ish-Ko-man. for detailedinvestigations along the small, ruby-bearingmarblezone. 11. services to the private sectoron contractbasis. GSP will also provide specialized

Corporation(PMDC) would continueto operatepuiti, L2. PakistanMineral Development salt minesin the salt range(Punjab)and in the Kohat District (NWFP). In the LasbelaDistrict, Balochistan, PMDC in Cooperation of Economicand Social with United NationsDepartment of Zinc and Irad Development(UNDESD) is and shall continueinvestigatingthe presence mineralization,of several meter thicknesscontaining about 15.57o Zinc and 3To lead by geotechnical surveysand grid drilling. In the Gilgit region (NorthernAreas)and Chitral region (NWFP), gold exploration based on modern conceptsand techniques,supportedby the of Australiawill continue Government 13. Gemstone Corporationof Pakistanhas beenand still is carrying out the prospection, of gemstone areaswith emeralds,rubies explorationand development , topaz,beryl in hI\MFP

in the mines to the emerald exploitation are restricted and Gilgit agency.However,its activities in Mingoraand Gujarkili (SwatDistrict,NWFP). to explore and developthe Development Corporationhas been established 14. Resource District, Balochistan. Actual construction area, Chagai in Saindak porphyrytype copperdeposits is underway.The project is a PakistanChinese work for the mine, infrastructureand utitrities with equipmentand servicesbeing suppliedfrom China, on a credit basis, to be Cooperation is plannedto repaidby blister copper,producedfrom the sameproject. The total investment Rs 6.22 billion. of component Rs 11.19billion with Foreignexchange Special Areas
'

FATA, NA and Al&K 15. Federally AdministeredTribal Areas DevelopmentCorporation(FATADC) would projects suchas Marblequarryingin KhyberAgency, its ongoing approved to complete continue in North Waziristan,Chromitein Bajaur Agencyetc. explorationof copperand manganese 16. In the Nofthern Areas exploration and evaluation of economic mineral resources Government andPMDC wouldcontinue. particularly of Australian of gold with thecollaboiation Mining consultants, studycarriedout by the International 17. Basedon the Mineral Sectoral in Corporation(AKMIDC) will concentrate Azad KashmirMineral and IndustrialDevelopment (i) prepared. portfolios projects, have been the of which of the following seven the development DhanwanBauxiteand Fireclay Deposits,Kotli Area, (ii) Marble Quarry in NauseriArea; (iii) Dimensionstoneindustry in Kotli Area; (iv) Kamroti (Gala)Dolomite Deposit,Kotli Area;(v) Area, ffid Tarli Domel GraphiteDeposit,Kel Area; (vi) ShawaiGypsumDeposit,Muzaffarabad (Vii), BatmangLimestoneDeposit, Muzaffarabad Area. Further geologicaland geo-chemical initiated by UNDESD explorationwork, small scalemining of ruby and mining of Pegmatites would continue. Provincial Punjab Minerals Development Coryorution Areas,PUNJMIN wouldestablish SaltMinesin the SaltRange 18. In additionto developing Fuller's earth activation plant, explore ir.on ore depositsin Chiniot ilffi, evaluateDhariala otherindustrialminerals in District Chakwalandalsoexploreandevaluate Brine deposits Potash and Murree Hills in the Kala Chitta Range Sindh 19. Mineral identificationand evaluationstudy of Industrial rocks and Minerals found in Dadu and Tharparkar Districts would continue. The Industrial minerals, if economically would meetthe ever growing demandof glass,chemicaland steelindustries. established

209 Authoritl Sarhad Development Authority(SDA)wouldconcentrate 20. Development its activities Sarhad for theexploration of following minerals/projects and development 2t. Rock Phosphate of Kakul and lagarban- Tarnawaiareasto supply its productsto SSP factoryof NFC at Haripur; Nepheline syenite of Koga, Mardanareafor its utilizationas a raw materialfor glassand ceramicindustry; Iad-zinc deposits of Besham, Kohistan;boulangerite with gold and silver contents in Chitral areabeing exploredwith the supportof the Australian government and in co-operation with PMDC, Scheelite at GaramChashma, Copper-silver at Drosh,Chromiteof Malakand for Phosphate, Iron, vermiculite,zirconium andCarbonatites and rare earths. Baluchistan Developrnent Authority 22. Baluchistan Development Authority (BDA) would undertake the following projects:-

23. Zinc-lead deposits of Gunga, westof Khuzdar, vermiculite of Doki River nearDalbandin, bauxiteand fluorite nearDalbandin,quartzitein l-asbelaareaand sulphurin Nokkundi region. FurthermoreBDA in collaboration with BHP-UTAH would undertake prospection, exploration and development of gold and associated mineralsin Chagai Hills and Siah-Regareasin Balochistan. Targets & Allocation 24. The total public sectorinvestment programmein the mineral sectorduring the Eighth Plan is envisaged to be Rs 7.196 billion consisting of Rs 6.63 billion for FederalProgramme and Rs 0.5? billion for ProvincialProgramme. The detailsof financialoutlaysanOphysical targetsare given in Statistical AppendixTables-III-4. | & 4.2 respectively.