In the past ten days, the Taliban sold 150,000 tons of crude oil for over $80 million. This follows their 25-year contract with China’s CAPEIC, which invested $49 million to boost daily production to 8,000 barrels.
Beijing’s investment in Afghanistan is starting to pay off as the government has sold 150,000 tons (1.1 million barrels) of crude oil from the Amu Darya basin for more than $80 million in the last ten days.
The Taliban successfully put up an additional 20,000 tons (or 146,000 barrels) of crude worth $10.5 million for bidding on the same day that it had sold 130,000 tons of crude oil for $71.6 million, according to Humayun Afghan, the spokesperson for the ministry of mines and petroleum on Sunday. This is a dramatic turnabout for one of the most unstable areas of the Middle East, where the nation used to import the 50,000 barrels of oil per day it needed from nearby nations like Uzbekistan and Iran.
Everything started a year ago when the Taliban government in Afghanistan and China’s Xinjiang Central Asia Petroleum and Gas Co., or CAPEIC, signed a 25-year contract. Under the terms of the agreement, CAPEIC must contribute $150 million in the first year and $540 million in total by 2026. The country’s daily crude oil output has increased to more than 1,100 metric tons (8,000 barrels per day) because of CAPEIC’s $49 million investment in Afghanistan thus far. If the firm is to meet its contract, this number might rise considerably. A senior Taliban official claimed that incorrect labor and material cost estimates, along with a three-month wait for Afghan authorities to approve CAPEIC’s financial plan, prevented the organization from reaching its investment goal.
“The investments will add up as the contract stipulates,” the Taliban official told VOA on condition of anonymity, adding that the Taliban’s treasury earned about $26 million from the project last year.
According to a 2011 study by the U.S. Geological Survey, the Amu Darya basin, which spans Afghanistan and Tajikistan, is believed to hold 52,025 billion cubic feet of natural gas and 962 million barrels of crude oil. To take advantage of this potential, CAPEIC intends to drill 22 more wells in 2024 to raise daily production to above 2,000 tons, or over 15,000 barrels.
Since the United States withdrew from Afghanistan in 2021 after a 20-year engagement, Beijing has been getting closer to Kabul. Since the formation of a Taliban government in Kabul, Chinese and Afghan diplomats have been meeting virtually every week, and some in the West have suggested that there may be developing “cooperation.” The Taliban’s ambassador to Beijing gave his diplomatic credentials to Chinese President Xi Jinping back in January. The decision confused both allies and adversaries because no nation has formally acknowledged the legitimacy of the Taliban rule. It’s unclear, though, if Beijing’s actions amount to diplomatic recognition.
“Although the attraction of [Afghanistan’s] mining and energy resources is strong, there is considerable Chinese wariness about the internal security situation, the reliability of Taliban assurances regarding foreign investments, and Afghanistan’s poor infrastructure,” Andrew Scobell, distinguished fellow for China at the United States Institute of Peace, told VOA.
Some geopolitical analysts, however, have theorized that Beijing’s primary goal in engaging with Afghanistan is risk reduction in the event of a potential security vacuum. This is a reasonable theory given that the two nations share a 92-kilometer border. The China-Pakistan Economic Corridor will encompass Afghanistan, as agreed upon by Beijing and Islamabad last year. The goal of CPEC is to improve the connectedness of its partners by offering a model for civil-military cooperation.
There’s no denying China’s desire to exert influence over Central Asia for several reasons. The Belt and Road Initiative, a worldwide infrastructure development project proposed by the Chinese government in 2013 to invest in over 150 countries and international organizations, includes the region as a fundamental component. Second, Beijing would like Kabul to view it as a prominent regional ally against rival nations like Russia and India, both of which have some sway over Afghanistan.
The potential of China regaining control of the Bagram airfield, which its military used as its primary base during the Afghan war, worries the U.S. government and other lawmakers greatly.
Thomas West, the United States’ special representative for Afghanistan, said, “We don’t see Afghanistan as a place where we need to compete with the Chinese and the Russians.”
China and the US have taken rather different diplomatic tacks when it comes to Afghanistan. China has opted for investment and security cooperation, while the United States continues to be Afghanistan’s top humanitarian contributor, having sent over $2 billion in aid since the Taliban took power.
Recently, GreatGameIndia reported that Afghanistan’s acting Industry and Trade Minister Nooruddin Azizi told Reuters that Russia and Afghanistan plan to build a logistics center for oil transit to South Asia, involving Kazakhstan and Turkmenistan, in its northwestern Herat province.
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