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Afghan Mining Opportunity Afghanistan has substantial mineral and petroleum deposits: –Copper (Aynak = 11.3 million tons) –Iron (Hajigak = 1.8 billion.

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Presentation on theme: "Afghan Mining Opportunity Afghanistan has substantial mineral and petroleum deposits: –Copper (Aynak = 11.3 million tons) –Iron (Hajigak = 1.8 billion."— Presentation transcript:


2 Afghan Mining Opportunity Afghanistan has substantial mineral and petroleum deposits: –Copper (Aynak = 11.3 million tons) –Iron (Hajigak = 1.8 billion tons) –Oil and Gas estimated at 36 trillion cubic feet and 3.6 billion barrels respectively –Precious Stones (over 120 occurrences) –Precious Metals (112 gold occurrences) –Other (aggregates, etc.) In 2002, the US Geological Society (USGS) compiled a list of 1,079 Afghan mine and mineral occurrences Still under explored – High probability of finding significant additional reserves Currently mining is less than $100 million in Afghan GDP (<1%) Opportunity to more than double Afghan national revenue in mid-term –2009/10 total government revenue = $1 billion –Up to $1 trillion in mining reserves (according to President Karzai) – Not including extraction –Aynak and Hajigak alone could eventually create revenues of $1 billion+ annually All minerals located on or under the surface are the sole property of the government Significant generator of jobs and economic development Value chain and building aggregates can have near-term COIN impact Mining Sector Overview Afghan Opportunity Significant enabler of Afghan self sufficiency

3 Primary Mining Sectors Copper Iron Oil and GasPrecious Stones and Metals Hajigak iron ore deposit located over 100km west of Kabul is the best known deposit. 1.8 billion ton of iron ore with a concentration of approximately 62%. World class opportunity (primary ore accounts for 80% of the ore). Bloomberg – Afghanistan Invites New Iron Mine Bids Over Transparency Issues. Gemstone varieties include emerald, sapphire, aquamarine, tourmaline, kunzite, ruby, lapis lazuli, spinal and more. Gold is another precious metal opportunity. Opportunity to grow to gemstones from $3 million to $300 million per year (as per USAID) with improved extraction and processing (85% exported for processing). Marble is another key focus area. Current interest is focused on Anyak, the Darband, and the Jawkhar prospects in southeastern Afghanistan. Aynak is estimated at 11.3 million tons and is expected to employ up to 40,000 people (directly and indirectly) when fully operational. Expected to generate $350+ million in taxes to GIRoA annually. Previously, copper has been mined from the following Provinces: Heart, Farah, Kapisa, Kandahar and Zabul. Gas fields have been identified in several locations including yateem Taq, Khwaja Gogardak, Khwafa Bolan, Zigdeli, Bayan Ghor and the outskirts of Sherber Ghan. 500 total fields (8 identified having the geological capacity 0f 180 billion cubic meters of gas). Sar-e-pul oil reserves has been identified (44.5) million tons with the extractable reserves reaching 14.5 metric tons. Source: British Geological Survey and Ministry of Mines Aynak Source: Ministry of Mines Hajigak Source: Ministry of Mines Source: USGS

4 Opportunities Blanket The Country Copper Iron Oil and Gas Precious Stones and Metals Source: British Geological Survey and Ministry of Mines Source: Ministry of Mines Source: USGS

5 TFBSO Prioritized Mineral Sites TBD

6 Recent Mining Progress/Issues Recently-gazetted laws and new mining regulations approved by the cabinet on December 14 should improve the regulatory environment New Mining Minister Shahrani –Afghanistans 24 th Minister of Mines –First with an economic and business background –Keenly interested in developing sector with an eye on investment promotion Creation of Infrastructure and Economic Development cluster –Chaired by Minister Shahrani –Key priority is to prepare Afghanistan for large scale investment in extractive industries –Mining sector will receive heightened level of focus Issues: –Hajigak tender delayed, per newspaper reports, to ensure transparency –Aynak production delayed –Lack of established value-chain infrastructure

7 IJC Mining Considerations Continue to support Deputy Undersecretary Brinkleys business support task force, which will begin investment support activities for industrial minerals operations in 2010 Synchronize with USAID is assessing the mines to market value chain –Creation of Afghan business associations –Product finishing training –Technology development and equipment supply –Public private partnerships, market linkages, and industry infrastructure strengthening Work with IPA and PRTs to analyze potential needs at the provincial and district levels –Explore CERP opportunities accordingly Leverage shorter term COIN opportunities to set the stage for exploitation of this sector in the future Develop a positive I/O campaign to communicate the value of this important market Bottom Line: Mining is one of the most important sectors in Afghanistan and should be pursued to the greatest extent possible

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