Dear Friends:
What an interesting news! Read it straight from today's Independent (28
12 201)
-bhuban
The war may be raging still, but the scramble for Afghanistan has
already begun, and China is emerging at the head of the pack after it
became the first foreign state to win the right to hunt for oil in the
country.
The state-owned National Petroleum Corporation (CNPC) will sign a deal
with Afghanistan's Ministry of Mines today, which will allow the
Chinese firm to work oil blocks in the north-eastern provinces of Sari
Pul and Faryab.
The deal will give China access to the Amu Darya River Basin, which is
said to contain reserves of about 87 million barrels of oil, a
statement from the president's office in Kabul said yesterday.
"This is the first big contract for exploration and extraction of oil
in Afghanistan," the statement said. Afghanistan is landlocked and
needs to import its fuel from neighbouring Iran and from central Asian
countries.
While this deal is relatively small, it sends a signal that Beijing is
first in line for the potentially lucrative reserves that are yet to be
drilled. China's rapidly expanding economy relies heavily on natural
resources from abroad to keep going, and China has signed deals in some
of the world's toughest markets to ensure its energy supply continues
without a hitch. This has seen China sign deals with governments that
the West sees as pariah states.
China already has the biggest single foreign investment in Afghanistan
– three years ago the China Metallurgical Construction Coorporation
signed a £2.2bn contract to develop the Aynak copper mine in Logar
province.
Afghanistan is still seen as a good way off being stable enough to lure
the mainstream international investor. However, Sari Pul and Faryab are
many hundreds of miles away from the main conflict hotspots and are
considered reasonably safe. The US-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.
Minister Wahidullah Shahrani will sign the accord with the director of
the Beijing-based company, and the contract calls for CNPC to form a
joint venture with a local partner, the Watan Group. Some 70 per cent
of the profits from the joint-venture operation will be paid to the
government.
The Soviets identified vast mineral resources in Afghanistan in the
1970s, including oil, copper and iron. However, roads and other
infrastructure were underdeveloped to begin with and what was there has
been badly damaged during decades of conflict, keeping Western miners
at bay.
For China, the deal marks a first step in a country that could
ultimately prove very profitable indeed. And for Chinese firms, poor
infrastructure is as much of an opportunity as it is a challenge. All
over Africa, Chinese firms are building roads and hospitals and schools
and football stadiums, both to cement soft power in resource-rich
African countries and also to build the infrastructure needed to move
the resources out and back to China.
As well as significant expertise in building roads in developing
countries, Chinese firms also build airports and other transport hubs,
and are keen to sell the country's high-speed rail technology overseas.
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