The National Accountability Bureau (NAB) has raised alarm over what it says are massive financial losses in Khyber Pakhtunkhwa’s placer gold mining sector, accusing provincial authorities of undervaluing rich gold deposits along the Indus and Kabul rivers and ignoring regulatory breaches.
An inquiry led by NAB claims the province has forfeited revenue worth trillions of rupees due to underpriced lease auctions, weak oversight, and widespread illegal mining operations. Official documents reviewed by this publication detail how mining companies have been subletting contracts and charging between Rs500,000 and Rs700,000 per excavator per week—generating as much as Rs1 billion weekly—while government earnings remain negligible.
KP Government Defends Auctions
Chief Minister Ali Amin Gandapur rejected NAB’s allegations, insisting his administration raised the auction price for gold blocks and conducted the process transparently.
He said his government set a minimum price of Rs1.10 billion per block, compared to a previous ceiling of Rs650 million, and secured nearly Rs4.6 billion for four blocks in a ten-year lease. Gandapur also noted that this was the first proper auction in two decades, following years of rampant illegal extraction.
“The process was advertised multiple times, bids were low, but we eventually auctioned at higher rates,” Gandapur said, adding that NAB was notified in advance and had an officer present during the bidding. He questioned why a geological study launched in 2023 was “suddenly halted” and vowed to continue operations against illegal miners.
NAB’s Investigation Paints a Different Picture
According to NAB’s internal reports, the reserve price for placer gold deposits was deliberately undervalued despite a 2015 geological survey by the National Centre of Excellence in Geology, which identified gold reserves ranging from 0.21 to 44.15 grams per ton. The bureau accuses the provincial mines department of bypassing KP Auction Rules 2022 to favor specific bidders.
The inquiry also revealed that a geological mapping project started in 2022 was inexplicably discontinued in November 2023—only for gold deposits—raising suspicions of data suppression. Earlier auctions failed partly because of limited publicity, discouraging international interest.
Contract Irregularities and Court Defiance
NAB documents highlight a string of procedural violations, including lease agreements finalized months late despite rules requiring cancellations after a 14-day delay. Mining activities reportedly continued even after a Peshawar High Court stay order in November 2024.
Investigators also cited environmental and safety lapses:
- No Environmental Protection Agency approvals or environmental impact assessments.
- No installation of processing plants or implementation of mining plans.
- Use of mercury and employment of untrained labor.
- Absence of production and sales reporting.
A Massive Illegal Operation
NAB estimates over 1,500 excavators are currently digging along the rivers, most operating illegally. With leaseholders allegedly pocketing Rs750 million to Rs1.05 billion weekly, the bureau warns that “trillions have already been siphoned” while the state collects only a fraction.
The investigation signals deep-rooted governance issues in KP’s mineral sector and raises questions about regulatory enforcement in one of Pakistan’s most resource-rich regions.
