(FiveNation.com)- The Taliban government of Afghanistan has signed a contract with a Chinese state-run firm allowing it to drill for oil in the northern region of the country, marking the first major energy extraction agreement with a foreign firm since the Taliban took over Afghanistan in August 2021.
Under the signed agreement, China’s Xinjiang Central Asia Petroleum and Gas Company will be able to drill for oil in Afghanistan’s Amu Darya basin for 25 years.
At a press conference in Kabul last week, Wang Yu, China’s ambassador to Afghanistan described the Amu Darya contract as “an important project between China and Afghanistan.”
The Taliban continues to look to China as a friendly trade partner to tap its vast reserves of resources.
And why would China say no? Afghanistan sits on a veritable treasure trove of rare earth minerals, as well as natural gas and copper. In total, the vast reserves, which remained untapped due to decades of war and turmoil, are estimated to be worth anywhere from $1 trillion to $3 trillion.
In addition to the Taliban’s agreement with Xinjiang Central Asia Petroleum and Gas, another Chinese state-owned company is reportedly in talks with the Taliban to operate a copper mine in eastern Afghanistan.
While Beijing has not formally recognized the Taliban government of Afghanistan, it has significant interests in the country given Afghanistan is at the center of the region vital to China’s Belt and Road Initiative.
Launched in 2013 by Chinese President Xi Jinping, the Belt and Road initiative provides financing to emerging countries to build infrastructure projects like ports, roads, and bridges while giving China more influence and control in participating countries.
Last week’s agreement between China and Afghanistan came as Taliban officials announced that security forces had targeted the Islamic State militants who, in December, attacked a Kabul hotel popular with Chinese businessmen. According to the Taliban, the security forces killed 8 militants and arrested several others.
In December, ISIS attacked the Longan Hotel in Kabul, killing at least three people and injuring 18 others, including five Chinese nationals.