Sher Malang
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Afghanistan will start accepting investor offers next week to explore for at least 600 million barrels of crude oil in the western half of the Afghan-Tajik Basin, the countrys mining minister said.
The auction beginning March 7 will cover six blocks in the basin, located in the countrys north, and will include rights for exploration and production, Minister of Mines Wahidullah Shahrani said yesterday in an interview in Washington.
The initial indication is that there would be at least 600 million barrels of oil in that western part of the Afghan- Tajik basin, he said. There is also potential for discovery, once they do the exploration, for gas in the same basin.
The auction would be Afghanistans first new offering of energy and mineral deposits this year in a country desperate for revenue as a 50-nation coalition begins to withdraw its troops amid continuing violence.
Chevron Corp., the second-largest U.S. oil producer, is among the companies that expressed interest in bidding for the Afghan-Tajik Basin during meetings with other ministry officials last week in Houston, Shahrani said.
Lloyd Avram, a spokesman for San Ramon, California-based Chevron, said that, while the company continuously looks for value-added opportunities around the world, it doesnt comment on business discussions.
The Afghan-Tajik Basin is estimated to hold 946 million barrels of undiscovered crude oil and 7 trillion cubic feet of natural gas, according to a U.S. Geological Survey report.
China National Petroleum Corp. last year won an auction to develop three blocks of the Amu Darya basin, a geological zone that extends into Turkmenistan and Uzbekistan. The three blocks were estimated to hold 80 million barrels and the Afghan government projected it would yield about $7 billion in profits.
The company, which is PetroChina Co.s parent, won the tender by offering to build a refinery and pay more royalty than rivals from Australia, the U.K., the U.S. and Pakistan. Production is due to begin in October, Shahrani said yesterday.
Shahrani, who is visiting Washington to meet with U.S. companies as well as government agencies supporting Afghanistans economic development, said the ministry will announce the results next week of a tender process that began in December for four gold and copper deposits. The announcement is scheduled for March 9, he said.
Afghanistan may hold unexplored mineral deposits worth as much as $1 trillion, the Pentagon said in June 2010, citing U.S. Geological Survey data. The Afghan government has estimated the figure as high as $3 trillion.
India and China have so far led foreign investment in the countrys mineral resources. State-owned Metallurgical Corp. of China is developing the Aynak copper mine in Afghanistan, where production is expected to begin in 2014, according to Shahrani.
Companies from outside the region are more likely to be wary of investing in Afghanistan, said Prasad Patkar, who helps manage about $1 billion at Platypus Asset Management Ltd. in Sydney.
I wouldnt imagine Afghanistan attracting large investment immediately, Patkar said in a telephone interview. There are volatile areas that are geologically more appealing, like the Democratic Republic of Congo.
Among American companies, Afghanistan is most likely to interest those that focus on oil and gas, rare earths, gold and, to a certain extent, copper, Shahrani said.
Afghanistan is funding a 7,000-person security force to protect mining assets, with 1,500 personnel stationed at the Aynak mine at a cost of about $7 million a year, Shahrani said in a December interview.
Meeting With Molycorp
Shahrani said he will meet with representatives from Molycorp Inc. of Greenwood Village, Colorado. The company owns the largest rare-earth deposit outside China.
Molycorp had a meeting with Afghan officials on Sept. 23 at the suggestion of the U.S. State Department to discuss long-term plans for mineral development, Jim Sims, a spokesman for the company, said in an e-mail. Sims said the company hasnt met with Afghan representatives since and he isnt aware of any meetings are scheduled.
Source: Afghanistan sets auction for oil exploration - DailyHerald.com
The auction beginning March 7 will cover six blocks in the basin, located in the countrys north, and will include rights for exploration and production, Minister of Mines Wahidullah Shahrani said yesterday in an interview in Washington.
The initial indication is that there would be at least 600 million barrels of oil in that western part of the Afghan- Tajik basin, he said. There is also potential for discovery, once they do the exploration, for gas in the same basin.
The auction would be Afghanistans first new offering of energy and mineral deposits this year in a country desperate for revenue as a 50-nation coalition begins to withdraw its troops amid continuing violence.
Chevron Corp., the second-largest U.S. oil producer, is among the companies that expressed interest in bidding for the Afghan-Tajik Basin during meetings with other ministry officials last week in Houston, Shahrani said.
Lloyd Avram, a spokesman for San Ramon, California-based Chevron, said that, while the company continuously looks for value-added opportunities around the world, it doesnt comment on business discussions.
The Afghan-Tajik Basin is estimated to hold 946 million barrels of undiscovered crude oil and 7 trillion cubic feet of natural gas, according to a U.S. Geological Survey report.
China National Petroleum Corp. last year won an auction to develop three blocks of the Amu Darya basin, a geological zone that extends into Turkmenistan and Uzbekistan. The three blocks were estimated to hold 80 million barrels and the Afghan government projected it would yield about $7 billion in profits.
The company, which is PetroChina Co.s parent, won the tender by offering to build a refinery and pay more royalty than rivals from Australia, the U.K., the U.S. and Pakistan. Production is due to begin in October, Shahrani said yesterday.
Shahrani, who is visiting Washington to meet with U.S. companies as well as government agencies supporting Afghanistans economic development, said the ministry will announce the results next week of a tender process that began in December for four gold and copper deposits. The announcement is scheduled for March 9, he said.
Afghanistan may hold unexplored mineral deposits worth as much as $1 trillion, the Pentagon said in June 2010, citing U.S. Geological Survey data. The Afghan government has estimated the figure as high as $3 trillion.
India and China have so far led foreign investment in the countrys mineral resources. State-owned Metallurgical Corp. of China is developing the Aynak copper mine in Afghanistan, where production is expected to begin in 2014, according to Shahrani.
Companies from outside the region are more likely to be wary of investing in Afghanistan, said Prasad Patkar, who helps manage about $1 billion at Platypus Asset Management Ltd. in Sydney.
I wouldnt imagine Afghanistan attracting large investment immediately, Patkar said in a telephone interview. There are volatile areas that are geologically more appealing, like the Democratic Republic of Congo.
Among American companies, Afghanistan is most likely to interest those that focus on oil and gas, rare earths, gold and, to a certain extent, copper, Shahrani said.
Afghanistan is funding a 7,000-person security force to protect mining assets, with 1,500 personnel stationed at the Aynak mine at a cost of about $7 million a year, Shahrani said in a December interview.
Meeting With Molycorp
Shahrani said he will meet with representatives from Molycorp Inc. of Greenwood Village, Colorado. The company owns the largest rare-earth deposit outside China.
Molycorp had a meeting with Afghan officials on Sept. 23 at the suggestion of the U.S. State Department to discuss long-term plans for mineral development, Jim Sims, a spokesman for the company, said in an e-mail. Sims said the company hasnt met with Afghan representatives since and he isnt aware of any meetings are scheduled.
Source: Afghanistan sets auction for oil exploration - DailyHerald.com
