Afghanistan Signs Oil Deal with China

[Shirib]

Afghanistan, China to sign first oil contract on Wednesday, ministry says

KABUL, Afghanistan — Afghanistan will sign a deal Wednesday allowing China’s state-owned National Petroleum Corporation to become the first foreign firm to produce oil in the country, the Ministry of Mines said.

The deal will allow the Chinese firm to work oil blocks in the northeastern provinces of Sari Pul and Faryab. The area, known as the Amu Darya River Basin, is believed to have reserves of about 87 million barrels of oil.

Minister Wahidullah Shahrani will sign the accord with the director of the Beijing-based company, ministry spokesman Jawad Umer said Tuesday. The contract calls for CNPC to form a joint venture with a local partner, the Watan Group.

A statement said 70 percent of the profits from the operation will be paid to the government.

The government said the contract with CNPC will be the first with a foreign company to exploit oil reserves in Afghanistan. It has been keen to develop a modest oil-extraction and refining capability for the landlocked nation, which is entirely reliant on fuel imports from neighboring Iran and Central Asian nations.

The provinces of Sari Pul and Faryab are located hundreds of miles from the centers of fighting in the east and southeast and are considered relatively safe. As a result, the U.S.-led NATO force has already transferred or is turning over responsibility for security in large parts of the region to the Afghan army and police.

Surveys conducted by the Soviets in the 1970s have shown that Afghanistan sits on vast mineral wealth. Afghan and foreign companies already have shown interest, notably in its untapped copper, iron and oil deposits. But with poor infrastructure and security problems stemming from the 10-year war, most Western mining companies have shied away from firm commitments.

So far, companies from China — with which Afghanistan shares a small stretch of border in its east — have been in the forefront of investments in the nation.

Three years ago the China Metallurgical Construction Co. signed a contract to develop the Aynak copper mine in Logar province. Beijing’s $3.5 billion stake in the mine is the largest foreign investment in Afghanistan so far.

http://www.washingtonpost.com/business/ ... story.html

[Shirib]

So America sent in troops, thousands of American soldiers dead, and the oil deal goes to China. US is losing this thing big time. smh

[The_Patriot]

So America sent in troops, thousands of American soldiers dead, and the oil deal goes to China. US is losing this thing big time. smh

and by the way its not Taliban doing the deal.

[Monk-of-Mogadishu]

I agree with the big-footed guy above.

Any deal with this regime is a joke. The chinks were smart though, they are exploring two provinces that are Uzbek-majority, which means they don't have to deal with the Pashtun-Tajik-Hazarah tug of war. However, the chinks will be uprooted as soon as the US leaves; there are Taliban south of those provinces and Taliban-allied Uzbek militants north of the province in Uzbekistan. The chinks are doing this in vain, even they know its in vain.

[union]

Oh well, there's plenty of oil in Iran.

[The_Patriot]

Oh well, there's plenty of oil in Iran.

And so in Alaska.

[waryaa]

I think America is cool with it as long as China is not coming in with tanks and army platoons. American oil firms are driven by profit and they may have discounted it as unprofitable when China is driven by national needs.

[Monk-of-Mogadishu]

And so in Alaska.

Low-grade oil trapped under rocks, yes. But its not even possible to drill in Alaska, let alone the crazy costs.


ON-TOPIC: China, along with Russia, India, and Iran have tried many times to prop up Uzbeks, Tajiks, and Hazarahs against the Taliban but all those attempts failed and were exposed. I don't think China can expect for a long-term contract inside Afghanistan. In any case, the route from Afghanistan towards China's eastern & southern industrial zones is a tough ride; the Taliban have propped up their own Uyghur-dominated Islamist group (East Turkestan Islamic Movement) who have been increasingly bold against the Chinese regime, and may open an all-out war in their province of Xinjiang which borders Afghanistan. The current crisis on both sides of the border will make it nearly impossible for China to have a secure supply route, yet another reason why this is destined to fail.