U.S. Identifies Vast Riches of Minerals in Afghanistan
The New York Times
A bleak Ghazni Province seems to offer little, but a Pentagon study says it may have among the world’s largest deposits of lithium.
By JAMES RISEN
Published: June 13, 2010
Excerpts from and Comments on Risen's article.
The principal point of this article is that The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials.
The reserves of deposits have previously been unknown — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium. They could eventually turn Afghanistan— into one of the most important mining centers in the world, the United States officials believe. Our viewpoint on this site has always identified the importance of Afghanistan's geographical location in a regional context where there are substantial oil reserves. Oil, pipelines, competition among major powers for oil and control over its distribution, and the corruption and environmental degradation that follows oil exploration and production - these are what we focused on. Now, with the discovery of rich mineral and metal deposits, Afghanistan's strategic position will grow in importance and perhaps generate even more international interest and conflict - and reasons for the US to keep troops in the country.
An internal Pentagon memo, for example, states that Afghanistan could become the “Saudi Arabia of lithium,” a key raw material in the manufacture of batteries for laptops and BlackBerrys.
The vast scale of Afghanistan’s mineral wealth was discovered by a small team of Pentagon officials and American geologists. The Afghan government and President Hamid Karzai were recently briefed, American officials said.
While it could take many years to develop a mining industry, the potential is so great that officials and executives in the industry believe it could attract heavy investment even before mines are profitable, providing the possibility of jobs that could distract from generations of war.
“There is stunning potential here,” Gen. David H. Petraeus, commander of the United States Central Command, said in an interview on Saturday. “There are a lot of ifs, of course, but I think potentially it is hugely significant.”
....Yet the American officials also recognize that the mineral discoveries will almost certainly have a double-edged impact.
Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country.
The corruption that is already rampant in the Karzai government could also be amplified by the new wealth, particularly if a handful of well-connected oligarchs, some with personal ties to the president, gain control of the resources.
....At the same time, American officials fear resource-hungry China will try to dominate the development of Afghanistan’s mineral wealth, which could upset the United States, given its heavy investment in the region. After winning the bid for its Aynak copper mine in Logar Province, China clearly wants more, American officials said.
....The mineral deposits are scattered throughout the country, including in the southern and eastern regions along the border with Pakistan that have had some of the most intense combat in the American-led war against the Taliban insurgency.
....So far, the biggest mineral deposits discovered are of iron and copper, and the quantities are large enough to make Afghanistan a major world producer of both, United States officials said. Other finds include large deposits of niobium, a soft metal used in producing superconducting steel, rare earth elements and large gold deposits in Pashtun areas of southern Afghanistan.
Just this month, American geologists working with the Pentagon team have been conducting ground surveys on dry salt lakes in western Afghanistan where they believe there are large deposits of lithium. Pentagon officials said that their initial analysis at one location in Ghazni Province showed the potential for lithium deposits as large of those of Bolivia, which now has the world’s largest known lithium reserves.
A version of this article appeared in print on June 14, 2010, on page A1 of the New York edition.
Showing posts with label china in Afghanistan. Show all posts
Showing posts with label china in Afghanistan. Show all posts
Monday, June 14, 2010
Tuesday, December 15, 2009
China builds a natural gas pipeline in Central Asia, while US wages war
Juan Cole updates issues that reflect China's interests in Central Asia and how, among other projects, it is building a natural gas pipeline in the region. This is something the US and a corporation Unicol had in mind back in the 1990s. In the meantime, the US is becoming further embroiled in a complex, seemingly futile "war," with great harm to the Afghan people and the loss of and injury to US troops, while China extends its economic power and control over regional gas and oil resources. This is not to say that we prefer Chinese imperialism over US imperialism. It would be better for the people of the region if they were not dominated by tyrannical governments and if there were alternatives that advanced the interests of the people. Nevertheless, Cole's commentary helps to remind us that Afghanistan is part of a region of the world that has gas and oil resources and that as a result is the center for competition among big powers for control of these resources. At this level, it has nothing to do with democracy. It is rather what Michael Klare analyzes as a manifestation of intensifying or incipient resource wars.
Bob
----------------------------------
Juan Cole, Informed Comment
Tuesday, December 15, 2009
China wins struggle for Pipelinestan
A common explanation for the US presence in Afghanistan is Washington's interest in Central Asian fuel sources-- natural gas in Turkmenistan and Uzbekistan and petroleum in Kazakhstan. The idea of Zalmay Khalilzad and others was to bring a gas pipeline down through Afghanistan and Pakistan to energy-hungry India. Turkmenistan became independent of Moscow in 1991, making the project plausible. For this reason some on the political Right in the US actually supported the Taliban as a force for law and order.
If that was the plan, it has failed. Instead, China has landed the big bid to develop a major gas field in Turkmenistan, along with a pipeline to Beijing. Turkmenistan had strongly considered piping the gas to Moscow instead, but developed conflicts with Gazprom.So the US is bogged down in an Afghanistan quagmire, and China is running off with the big regional prize.
On Tuesday, radical guerrillas deployed a bomb to kill 8 persons and wound 40 in an upscale area of Kabul where foreigners, including Indian aid workers, live-- in another sign of the deterioration of security in Afghanistan's capital. It is obvious how long a gas pipeline would last under these circumstances.
I'm not sure very many politicians in Washington were ever really so interested in the gas pipeline. For someone like then Secretary of Defense Donald Rumsfeld, making Afghanistan a US base may have aimed at surrounding and weakening Russia and keeping it from reemerging as a peer (a la the attempted push of NATO into places like Georgia.) Some US leaders, however, were pushing for it. In recent years a Turkmenistan pipeline was seen as a way of forestalling India from breaking the embargo on Iran. And I remember that in fall 2001, when congressmen asked Colin Powell how the Afghanistan war would be paid for, he replied that the region is rich in resources. Since Afghanistan is not, he must have been speaking of places like Turkmenistan.
In any case the Chinese just demonstrated that you don't need war to get resources. Avoid costly adventurism and grow your economy like hell, and it all falls into your lap.
Bob
----------------------------------
Juan Cole, Informed Comment
Tuesday, December 15, 2009
China wins struggle for Pipelinestan
A common explanation for the US presence in Afghanistan is Washington's interest in Central Asian fuel sources-- natural gas in Turkmenistan and Uzbekistan and petroleum in Kazakhstan. The idea of Zalmay Khalilzad and others was to bring a gas pipeline down through Afghanistan and Pakistan to energy-hungry India. Turkmenistan became independent of Moscow in 1991, making the project plausible. For this reason some on the political Right in the US actually supported the Taliban as a force for law and order.
If that was the plan, it has failed. Instead, China has landed the big bid to develop a major gas field in Turkmenistan, along with a pipeline to Beijing. Turkmenistan had strongly considered piping the gas to Moscow instead, but developed conflicts with Gazprom.So the US is bogged down in an Afghanistan quagmire, and China is running off with the big regional prize.
On Tuesday, radical guerrillas deployed a bomb to kill 8 persons and wound 40 in an upscale area of Kabul where foreigners, including Indian aid workers, live-- in another sign of the deterioration of security in Afghanistan's capital. It is obvious how long a gas pipeline would last under these circumstances.
I'm not sure very many politicians in Washington were ever really so interested in the gas pipeline. For someone like then Secretary of Defense Donald Rumsfeld, making Afghanistan a US base may have aimed at surrounding and weakening Russia and keeping it from reemerging as a peer (a la the attempted push of NATO into places like Georgia.) Some US leaders, however, were pushing for it. In recent years a Turkmenistan pipeline was seen as a way of forestalling India from breaking the embargo on Iran. And I remember that in fall 2001, when congressmen asked Colin Powell how the Afghanistan war would be paid for, he replied that the region is rich in resources. Since Afghanistan is not, he must have been speaking of places like Turkmenistan.
In any case the Chinese just demonstrated that you don't need war to get resources. Avoid costly adventurism and grow your economy like hell, and it all falls into your lap.
Monday, November 30, 2009
China outmaneuvers US in gaining access to Afghanistan's copper and mineral resources
The Karzai government opened up its copper and other energy and mineral resources to foreign investment in 2008. China is out-bidding investors from other countries for these opportunities, including out-bidding a US corporation. From China's perspective, these are not large investments, but they are substantial for Afghanistan and too expensive for US corporations. China has ample means to invest in resources virtually anywhere, as she has been doing in the Middle East, Africa, and South America. One of the principal points in the following article by Nicklas Norling is that, without putting any troops into Afghanistan, China is investing in Afghanistan's "large energy and mineral resources, particularly in copper...." Not much oil, though. And not an oil pipeline. If this investment would be combined with investment from somewhere in sustainable agriculture and other rural projects, then there would be a real encouraging story. In the meantime, China is outmaneuvering the US/NATO. And, not the least of it, this is another indication of America's relative decline and counterproductive military policies that drain limited US resources for no productive purpose. Better to develop a green economy in the US.
See article that follows.
Bob Sheak
---------------------------
Published on Central Asia-Caucasus Institute Analyst (http://www.cacianalyst.org)
THE EMERGING CHINA-AFGHANISTAN RELATIONSHIP
By Nicklas Norling (05/14/2008 issue of the CACI Analyst)
China showed little interest in Afghanistan throughout the 20th century but its growing energy and natural resource demand combined with increasing Afghan openness to foreign investors have alerted Beijing of the country’s potentials. This growing interest was particularly manifested with Beijing’s giant $3.5 billion investment in Afghanistan’s Aynak copper field late last year, the far largest foreign direct investment in Afghanistan’s history. Reports from Kabul also indicate that additional Chinese investments are underway. Although these investments may be the engine in Afghanistan’s economy, the Chinese piggy-backing on ISAF’s stabilization effort is bound to be unpopular in the U.S. and Europe, though not necessarily with the Afghan government.
BACKGROUND: China showed little interest in the reconstruction of Afghanistan following the overthrow of the Taliban. Bilateral assistance and aid have thus far been extremely limited, even if bilateral trade has steadily increased. According to some sources, China has now, together with Pakistan, emerged as a main exporter to Afghanistan while a few Chinese companies were also active in Afghanistan in the immediate aftermath of Operation Enduring Freedom.
For example, Chinese companies ZTE and Huawei partnered with the Afghan Ministry of Communications to implement digital telephone switches, providing roughly 200,000 subscriber lines. China has also taken part in the Parwan irrigation project, restoring water supply in Parwar province, as well as the reconstruction of the public hospitals in Kabul and Kandahar. Moreover, the EU has hired Chinese firms for various construction projects in Afghanistan, including road restoration activities.
The political ties between China and Afghanistan also have been relatively cordial since 2001, and President Karzai has publicly reiterated his ambition to emulate “America’s democracy and China’s economic success”. China and Afghanistan have signed a number of agreements for the establishment of bilateral business councils and other similar institutions devoted to the development of bilateral ties.
Notwithstanding that China has increased its activities in Afghanistan gradually since 2001, Afghanistan figured overall as a relatively peripheral concern to Beijing up until 2006. In contrast to China’s rapid emergence in neighbouring Siberia, Central Asia, Pakistan, and Southeast Asia, Afghanistan has remained a rather untouched square in Beijing’s Eurasian hopscotch. Indeed, this disinterest could be observed throughout the entire 20th century, perhaps partly accounting for the complete disregard of China as a potential future investor in the World Bank’s 2005 Investment Horizons: Afghanistan.
Some eyebrows were therefore raised when in 2007, China’s Metallurgical group launched a $3.5 billion bid and won the tender to develop Afghanistan’s Aynak copper field in Logar province. The copper field is estimated to be the largest undeveloped field in the world and has been virtually untouched since the Soviet invasion in 1979. The investment is the far largest in Afghanistan’s history and involves not only mining but also the construction of a $500 million electrical plant and a railway from Tajikistan to Pakistan to support exploration. The mine will be in full operation in around six years, lead to the employment of 10,000 Afghans, while $400 million of royalties will accrue the Afghan government yearly – more than half of the present yearly state budget. The mine is also estimated to generate millions of dollars in taxes and $200 million in annual shareholder revenues. Furthermore, the shallow Aynak field is comparatively easy to develop, which speaks in favour of a fast materialization of this project.
As could be observed elsewhere in the developing world, Chinese state-owned companies launch bids almost doubling those of their foreign rivals. The mine was estimated to go for $2 billion but the Chinese far outbid the competing Strikeforce (which is part of Russia’s Basic Element group), Kazakhmys Consortium, Russia’s Hunter Dickinson, and the U.S. company Phelps Dodge.
The tender forms part of Afghanistan’s national privatization program which has resulted in international tenders for most of the major state-owned companies during 2007-2008, while legislation is continually being adjusted to allow for foreign investments. Will this giant investment be the starting shot of a serious Chinese emergence in Afghanistan or will the hitherto disinterested approach to Afghanistan continue?
IMPLICATIONS: There are plenty of factors suggesting that China is set to increase its investments in Afghanistan in the near future. Afghanistan has unexplored reserves of oil and natural gas in the northern parts of the country. The Afghan oil reserves were recently upgraded 18 times by a U.S. geological survey, estimates standing at a mean of 1,596 million barrels, while Afghanistan’s natural gas reserves were upgraded by a factor of three, standing at a mean of 15,687 trillion cubic feet (Tcf).
Afghanistan also has large iron ore deposits between Herat and the Panjsher Valley, and gold reserves in the northern provinces of Badakshan, Takhar, and Ghazni. Major copper fields also exist in Jawkhar, Darband, and in abovementioned Aynak, located around 30 km southeast of Kabul. All of these resource-rich areas are also situated in the relatively stable northern and northwestern regions.
Moreover, China’s iron-ore demand increased close to 15 percent in the first 8 months of 2007, while copper demand surged by almost 35 percent in the same period. Natural gas demand has also increased rapidly, and China is desperately looking for overland energy supply diversification in the neighboring states in Central Asia, and potentially also in Afghanistan.
Apart from complementarity in supply and demand, the institutional development in Afghanistan is also entering a stage when it is becoming more and more prepared for hosting foreign companies; the Chinese also seem set to enter now when the time is ripe, and the state-owned companies are up for international tender. A similar timing of market entry has been demonstrated by Beijing in African countries.
China enjoys a comparative advantage to most other foreign companies, since the roof of spending is virtually limitless in sectors of strategic interest, which also speaks in Beijing’s favor in Afghanistan. However, the Chinese free-riding on U.S. efforts to stabilize Afghanistan while simultaneously outmaneuvering U.S. companies such as Phelps Dodge has been met with resentment in American policy-making and military circles.
Pentagon officials reportedly stated that “the Afghan government’s recent decision to award a copper mining contract [Aynak] to a Chinese company is worse than first reported.” These concerns may be warranted, considering the lackluster Chinese contribution to the Afghan stabilization effort.
On the other hand, it will also generate invaluable massive foreign investments to Afghanistan which will generate employment, infrastructure, and an enhanced state budget which, in turn, is essential to provide state services and maintain central control over the country. Indeed, a number of studies, including the World Bank’s 2004 report “Mining as a Source of Growth” have also identified the mining sector to be a potential engine in Afghanistan’s state-building effort.
CONCLUSIONS: China remained disengaged in Afghanistan until Karzai’s government recently opened up its energy, mineral, and raw materials to foreign investors. The Chinese exploration of Aynak copper field is likely the start of Beijing’s drive to seize as large a share as possible of Afghanistan’s natural resources. The Chinese government will likely be successful in these endeavors considering China’s good standing in Afghanistan, ability to distort the market, and fiscal wherewithal to outbid its competitors.
Afghanistan has large energy and mineral resources, particularly in copper, but they should at the same time not be exaggerated. China is likely to emerge as a large investor in the country, for better or worse, and Beijing’s interest in Afghanistan is likely to increase. It will nonetheless continue to be overall peripheral to China’s strategic concerns compared to Pakistan and the Central Asian countries.
AUTHOR’S BIO: Nicklas Norling is a Project Coordinator with the Central Asia-Caucasus Institute & Silk Road Studies Program Joint Center, based in Stockholm.
Source URL:http://www.cacianalyst.org/?q=node/4858
See article that follows.
Bob Sheak
---------------------------
Published on Central Asia-Caucasus Institute Analyst (http://www.cacianalyst.org)
THE EMERGING CHINA-AFGHANISTAN RELATIONSHIP
By Nicklas Norling (05/14/2008 issue of the CACI Analyst)
China showed little interest in Afghanistan throughout the 20th century but its growing energy and natural resource demand combined with increasing Afghan openness to foreign investors have alerted Beijing of the country’s potentials. This growing interest was particularly manifested with Beijing’s giant $3.5 billion investment in Afghanistan’s Aynak copper field late last year, the far largest foreign direct investment in Afghanistan’s history. Reports from Kabul also indicate that additional Chinese investments are underway. Although these investments may be the engine in Afghanistan’s economy, the Chinese piggy-backing on ISAF’s stabilization effort is bound to be unpopular in the U.S. and Europe, though not necessarily with the Afghan government.
BACKGROUND: China showed little interest in the reconstruction of Afghanistan following the overthrow of the Taliban. Bilateral assistance and aid have thus far been extremely limited, even if bilateral trade has steadily increased. According to some sources, China has now, together with Pakistan, emerged as a main exporter to Afghanistan while a few Chinese companies were also active in Afghanistan in the immediate aftermath of Operation Enduring Freedom.
For example, Chinese companies ZTE and Huawei partnered with the Afghan Ministry of Communications to implement digital telephone switches, providing roughly 200,000 subscriber lines. China has also taken part in the Parwan irrigation project, restoring water supply in Parwar province, as well as the reconstruction of the public hospitals in Kabul and Kandahar. Moreover, the EU has hired Chinese firms for various construction projects in Afghanistan, including road restoration activities.
The political ties between China and Afghanistan also have been relatively cordial since 2001, and President Karzai has publicly reiterated his ambition to emulate “America’s democracy and China’s economic success”. China and Afghanistan have signed a number of agreements for the establishment of bilateral business councils and other similar institutions devoted to the development of bilateral ties.
Notwithstanding that China has increased its activities in Afghanistan gradually since 2001, Afghanistan figured overall as a relatively peripheral concern to Beijing up until 2006. In contrast to China’s rapid emergence in neighbouring Siberia, Central Asia, Pakistan, and Southeast Asia, Afghanistan has remained a rather untouched square in Beijing’s Eurasian hopscotch. Indeed, this disinterest could be observed throughout the entire 20th century, perhaps partly accounting for the complete disregard of China as a potential future investor in the World Bank’s 2005 Investment Horizons: Afghanistan.
Some eyebrows were therefore raised when in 2007, China’s Metallurgical group launched a $3.5 billion bid and won the tender to develop Afghanistan’s Aynak copper field in Logar province. The copper field is estimated to be the largest undeveloped field in the world and has been virtually untouched since the Soviet invasion in 1979. The investment is the far largest in Afghanistan’s history and involves not only mining but also the construction of a $500 million electrical plant and a railway from Tajikistan to Pakistan to support exploration. The mine will be in full operation in around six years, lead to the employment of 10,000 Afghans, while $400 million of royalties will accrue the Afghan government yearly – more than half of the present yearly state budget. The mine is also estimated to generate millions of dollars in taxes and $200 million in annual shareholder revenues. Furthermore, the shallow Aynak field is comparatively easy to develop, which speaks in favour of a fast materialization of this project.
As could be observed elsewhere in the developing world, Chinese state-owned companies launch bids almost doubling those of their foreign rivals. The mine was estimated to go for $2 billion but the Chinese far outbid the competing Strikeforce (which is part of Russia’s Basic Element group), Kazakhmys Consortium, Russia’s Hunter Dickinson, and the U.S. company Phelps Dodge.
The tender forms part of Afghanistan’s national privatization program which has resulted in international tenders for most of the major state-owned companies during 2007-2008, while legislation is continually being adjusted to allow for foreign investments. Will this giant investment be the starting shot of a serious Chinese emergence in Afghanistan or will the hitherto disinterested approach to Afghanistan continue?
IMPLICATIONS: There are plenty of factors suggesting that China is set to increase its investments in Afghanistan in the near future. Afghanistan has unexplored reserves of oil and natural gas in the northern parts of the country. The Afghan oil reserves were recently upgraded 18 times by a U.S. geological survey, estimates standing at a mean of 1,596 million barrels, while Afghanistan’s natural gas reserves were upgraded by a factor of three, standing at a mean of 15,687 trillion cubic feet (Tcf).
Afghanistan also has large iron ore deposits between Herat and the Panjsher Valley, and gold reserves in the northern provinces of Badakshan, Takhar, and Ghazni. Major copper fields also exist in Jawkhar, Darband, and in abovementioned Aynak, located around 30 km southeast of Kabul. All of these resource-rich areas are also situated in the relatively stable northern and northwestern regions.
Moreover, China’s iron-ore demand increased close to 15 percent in the first 8 months of 2007, while copper demand surged by almost 35 percent in the same period. Natural gas demand has also increased rapidly, and China is desperately looking for overland energy supply diversification in the neighboring states in Central Asia, and potentially also in Afghanistan.
Apart from complementarity in supply and demand, the institutional development in Afghanistan is also entering a stage when it is becoming more and more prepared for hosting foreign companies; the Chinese also seem set to enter now when the time is ripe, and the state-owned companies are up for international tender. A similar timing of market entry has been demonstrated by Beijing in African countries.
China enjoys a comparative advantage to most other foreign companies, since the roof of spending is virtually limitless in sectors of strategic interest, which also speaks in Beijing’s favor in Afghanistan. However, the Chinese free-riding on U.S. efforts to stabilize Afghanistan while simultaneously outmaneuvering U.S. companies such as Phelps Dodge has been met with resentment in American policy-making and military circles.
Pentagon officials reportedly stated that “the Afghan government’s recent decision to award a copper mining contract [Aynak] to a Chinese company is worse than first reported.” These concerns may be warranted, considering the lackluster Chinese contribution to the Afghan stabilization effort.
On the other hand, it will also generate invaluable massive foreign investments to Afghanistan which will generate employment, infrastructure, and an enhanced state budget which, in turn, is essential to provide state services and maintain central control over the country. Indeed, a number of studies, including the World Bank’s 2004 report “Mining as a Source of Growth” have also identified the mining sector to be a potential engine in Afghanistan’s state-building effort.
CONCLUSIONS: China remained disengaged in Afghanistan until Karzai’s government recently opened up its energy, mineral, and raw materials to foreign investors. The Chinese exploration of Aynak copper field is likely the start of Beijing’s drive to seize as large a share as possible of Afghanistan’s natural resources. The Chinese government will likely be successful in these endeavors considering China’s good standing in Afghanistan, ability to distort the market, and fiscal wherewithal to outbid its competitors.
Afghanistan has large energy and mineral resources, particularly in copper, but they should at the same time not be exaggerated. China is likely to emerge as a large investor in the country, for better or worse, and Beijing’s interest in Afghanistan is likely to increase. It will nonetheless continue to be overall peripheral to China’s strategic concerns compared to Pakistan and the Central Asian countries.
AUTHOR’S BIO: Nicklas Norling is a Project Coordinator with the Central Asia-Caucasus Institute & Silk Road Studies Program Joint Center, based in Stockholm.
Source URL:http://www.cacianalyst.org/?q=node/4858
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