Afghanistan Resources Include Untold Wealth

Afghanistan Resources Include Untold Wealth

War stymies search for copper, jewels

by Paul Basken
Bloomberg News
The Houston Chronicle
December 23, 2001

WASHINGTON - The first time geologist John Shroder saw the captured Soviet documents in 1985, he concluded that their description of Afghanistan 's copper wealth was implausible. A conversation three years later with a Soviet Foreign Ministry official persuaded him otherwise. The papers, taken by Islamic fighters from a military convoy during the Soviet occupation, indicated that deposits of the metal beneath war-ravaged Afghanistan might rival those of Chile, the biggest producer.

Not only copper lies under the feet of Afghans, said Shroder, a geology professor at the University of Nebraska at Omaha, who has studied the country for three decades.

Afghanistan 's natural riches, some still being tallied, also include natural gas, coal, emeralds and other gemstones.

"Afghanistan has got everything it needs to be rebuilt once Osama bin Laden is out of there and we get ourselves organized," said Shroder, whose expertise is in demand by U.S. companies and Pentagon strategists.

Afghanistan 's natural gas supplies alone might contribute at least $330 million per year, based on U.S. government estimates of output that would have reached an annual rate of 140 billion cubic feet if not for war. That is enough gas to heat 1.7 million average U.S. households for a year.

Tapping such resources will help Afghanistan 's economic revival, bolstering as much as $6.5 billion the United States and its allies may spend on construction.

Possible political obstacles include a warlord in northern Afghanistan disgruntled with the makeup of the interim government that was set to take over Saturday. What's more, any attempt to exploit Afghanistan 's natural wealth must cope with rugged terrain, a lack of roads and archaic communications.

One of the last energy investors to visit was Total, now part of France's TotalFinaElf SA, back in 1975, says Mohammed Akram Jheyasi, acting chairman of the Ministry of Mines in Kabul.Exploration work in 65 locations identified eight gas fields and six oil fields as commercially attractive, Jheyasi said. Of those, two gas fields began production, with exports to the Soviet Union reaching a single-year peak of 92 billion cubic feet, he said. "If Allah wants it, we'll become self-sufficient one day" in natural gas, Jheyasi said. "Right now, we are importing liquid gas."

U.S. officials now view Afghanistan 's energy future in terms of a pipeline transit route, because the country sits between large gas producers in the Caspian Sea region and consuming markets in India and Pakistan.Afghanistan is estimated to have 3.5 trillion cubic feet of gas reserves and 73 million metric tons of hard coal, said Lowell Feld, an analyst with the Energy Information Administration. Afghanistan produced about 1,000 tons of coal in 1999, roughly 1 percent of its output in the early 1990s, according to U.S. data.

While the gas in the ground would amount to just one-sixth of what Russia produced last year, the wealth would be significant for a country with an estimated gross domestic product of $21 billion, about one-third of Mississippi's economy. Politics may complicate any effort to tap it.

Gen. Abdul Rashid Dostum, an ethnic Uzbek warlord who controls the northern areas where the known natural gas supplies are located, has said Afghanistan 's incoming interim government doesn't give him sufficient representation.

Abdul Razaq, chairman of the oil and gas department at the Afghan Ministry of Commerce, said he hopes Dostum and other warlords in the northern gas-producing regions will allow access by the country's new leadership.

"We hope to be able to get there, solve our problems and produce gas again," says Razaq, who sits in an unmarked and unheated office amid the broken windows of a downtown Kabul building.

Estimates of Afghanistan 's natural wealth may be understated, because surveys were conducted decades ago, using less-advanced methods and covering limited territory.

The country's resources include emeralds that rival those of world leader Colombia and other gemstones including lapis lazuli; chromite, used in metal plating; and pegmatites and rare-earth elements for bomb-making and specialty steels, according to Shroder. The country may have deposits of tungsten, lead, zinc and uranium ore. Similar claims were made in 1986 by researchers Richard Nyrop and Donald Seekins in a book that cited Afghan government data. They described Soviet estimates of 280 million tons of copper ore at Aynak, south of Kabul. Others are skeptical.

"I'd be very surprised" if Afghanistan has more copper than Chile, which with 90 million tons is believed to have the world's largest reserves, said Daniel Edelstein, copper expert at the U.S. Geological Survey. Afghanistan 's latent resources raise another concern. The World Bank warns that an economy reliant on commodities promotes instability by allowing corrupt governments easy access to tax revenue and by encouraging rebel groups to seize resources to pay for arms purchases."Not only are conflicts more likely to start, they are less likely to end," World Bank economist Paul Collier wrote in a report this month.

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