Taliban signs its first international deal with China to extract oil from Afghanistan

A pump jack on an oil well. [Photo: Wikimedia]

On Thursday, the first international deal was signed by the Taliban-led administration in Afghanistan to extract oil from the northern Amu Darya. The deal with China came as the beleaguered group seeks to increase the country’s revenue.

The deal was signed on Thursday as senior Taliban officials and China’s ambassador to Kabul, Wang Yu, witnessed the televised signing ceremony in Kabul. The deal marked the first major foreign investment deal in Afghanistan since the Taliban formed its government in August 2021.

Quoting the Taliban mining minister Shahabuddin Dilawar, Voice of America reported that the event the contract with the Xinjiang Central Asia Petroleum and Gas Co (CAPEIC) would bring $150 million a year in Chinese investment for the extraction of oil in the Amu river basin.

The deal covers an area of 4,500 square kilometers collectively in northern Saripol, Jowzjan and Faryab provinces, creating job opportunities for around 3,000 Afghans, he said.

The report quoting Dilawar stated that the Chinese investment is expected to increase to $540 million in three years for the 25-year contract. He added the Taliban administration will have a 20% partnership in the project, with a provision to increase it to 75%.

The Chinese ambassador hailed the “successful” signing ceremony, calling it a good start for promoting bilateral relations between Beijing and Kabul.

“The Amu Darya [River] oil project is an important project of practical cooperation between China and Afghanistan,” Wang said, as quoted by VOA.

“The progress of this project has created a model for China-Afghanistan cooperation in major projects in energy and other fields,” he said.


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