- Background
Afghanistan's significance from an energy standpoint stems from its
geographical position as a potential transit route for oil and natural gas
exports from Central Asia to the Arabian Sea. This potential includes
the possible construction of oil and natural gas export pipelines through
Afghanistan, which was under serious consideration in the mid-1990s.
The idea has since been undermined by Afghanistan's instability. Since
1996, most of Afghanistan has been controlled by the Taliban movement, which
the United States does not recognize as the government of Afghanistan.
On December 19, 2000, the UN Security Council imposed additional
sanctions against Afghanistan's ruling Taliban movement (which controls
around 95% of the country), including an arms embargo and a ban on the sale
of chemicals used in making heroin. These sanctions (Resolution 1333) are
aimed at pressuring Afghanistan to turn over Osama bin Laden, suspected in
various terrorist attacks, including the August 1998 US Embassy bombings in
Kenya and Tanzania. These latest sanctions are in addition to
sanctions (Resolution 1267) imposed on Afghanistan in November 1999, which
included a freeze on Taliban assets and a ban on international flights by
Afghanistan's national airline, Ariana. The Taliban reacted sharply to
the new sanctions, ordering a boycott of US and Russian goods, and pulling
out of UN-mediated peace talks aimed at ending the country's civil war.
On November 29, 1999, UN Secretary General Kofi Annan issued a report on
Afghanistan which listed the country's major problems as follows: civil war
(which has caused many casualties and refugees, and which has devastated the
country's economy), record opium production, wide-scale human rights
violations, and food shortages caused in part by drought.
According to the 2001
CIA World Factbook, Afghanistan is an extremely poor, landlocked
country, highly dependent on farming and livestock raising.
Afghanistan has experienced over two decades of war, including the nearly
10-year Soviet military occupation (which ended in 1989). During that
conflict one-third of the population fled the country, with Pakistan and
Iran sheltering a combined peak of more than 6 million refugees. Large
Afghan refugee populations remain in Pakistan and Iran. Gross domestic
product has fallen substantially over the past 20 years because of the loss
of labor and capital and the disruption of trade and transport. The
severe drought of 1998-2000 added to these problems. The majority of
the population continues to suffer from insufficient food, clothing,
housing, and medical care. Inflation remains a serious problem throughout
the country. International aid can deal with only a fraction of the
humanitarian problem, let alone promote economic development. The economic
situation did not improve in 1999-2000, as internal civil strife has
continued, hampering both domestic economic policies and international aid
efforts. Numerical data are likely to be either unavailable or unreliable.
Afghanistan was by far the largest world producer of opium poppies in 2000,
and narcotics trafficking is a major source of revenues.
Energy Overview
The Soviets had estimated Afghanistan's proven and probable natural gas
reserves at up to 5 trillion cubic feet (Tcf) in the 1970s. Afghan
natural gas production reached 275 million cubic feet per day (Mmcf/d) in
the mid-1970s. However, due to declining reserves from producing fields,
output gradually fell to about 220 Mmcf/d by 1980. At that time, the
Jorquduq field was brought online and was expected to boost Afghan natural
gas output to 385 Mmcf/d by the early 1980s. However, sabotage of
infrastructure by the anti-Soviet mujaheddin fighters limited the country's
total production to 290 Mmcf/d, an output level that was held fairly steady
until the Soviet withdrawal in 1989. After the Soviet pullout and subsequent
Afghan civil war, roughly 31 producing wells at Sheberghan area fields were
shut in pending the restart of natural gas sales to the former Soviet Union.
At its peak in the late 1970s, Afghanistan supplied 70%-90% of its
natural gas output to the Soviet Union's natural gas grid via a link through
Uzbekistan. In 1992, Afghan President Najibullah indicated that a new
natural gas sales agreement with Russia was in progress. However, several
former Soviet republics raised price and distribution issues and
negotiations stalled. In the early 1990s, Afghanistan also discussed
possible natural gas supply arrangements with Hungary, Czechoslovakia, and
several Western European countries, but these talks never progressed
further. Afghan natural gas fields include Jorqaduq, Khowaja Gogerdak,
and Yatimtaq, all of which are located within 20 miles of the northern town
of Sheberghan in Jowzjan province. Natural gas production and
distribution is the responsibility of the Taliban-controlled Afghan Gas
Enterprise. In 1999, work resumed on the repair of a distribution
pipeline to Mazar-i-Sharif. Spur pipelines to a small power plant and
fertilizer plant also were repaired and completed. Mazar-i-Sharif is
now receiving natural gas from the pipeline, as well as some other
surrounding areas. Rehabilitation of damaged natural gas wells has
been undertaken at the Khowaja Gogerak field, which has increased natural
gas production.
In February 1998, the Taliban announced plans to revive the Afghan
National Oil Company, which was abolished by the Soviet Union after it
invaded Afghanistan in 1979. Soviet estimates from the late 1970s
placed Afghanistan's proven and probable oil and condensate reserves at 95
million barrels. Oil exploration and development work as well as plans to
build a 10,000-bbl/d refinery were halted after the 1979 Soviet invasion.
A very small amount of crude oil is produced at the Angot field in the
northern Sar-i-Pol province. It is processed at a primitive topping
plant in Sheberghan, and burned in central heating boilers in Sheberghan,
Mazar-i-Sharif, and Kabul. Another small oilfield at Zomrad Sai near
Sheberghan was reportedly undergoing repairs in mid-2001.
Petroleum products such as diesel, gasoline, and jet fuel are imported,
mainly from Pakistan and Turkmenistan. A small storage and
distribution facility exists in Jalalabad on the highway between Kabul and
Peshawar, Pakistan. Turkmenistan also has a petroleum product storage
and distribution facility at Tagtabazar near the Afghan border, which
supplies northwestern Afghanistan.
Besides oil and natural gas, Afghanistan also is estimated to have 73
million tons of coal reserves, most of which is located in the region
between Herat and Badashkan in the northern part of the country. Although
Afghanistan produced over 100,000 short tons of coal annually as late as the
early 1990s, as of 1999, the country was producing only around 1,000 short
tons.
Afghanistan's power grid has been severely damaged by years of war.
Currently, the ruling Taliban are concentrating on rebuilding damaged
hydroelectric plants, power distribution lines, and high-voltage cables.
Production of power by Afghanistan's hydroelectric dams was negatively
affected by the drought of 1998-2000, resulting in blackouts in Kabul and
other cities. Increased rainfall in 2001 has improved power
production. The Kajaki Dam in Helmand province near Kandahar is
undergoing the addition of another generating turbine with assistance from
the Chinese Dongfeng Agricultural Machinery Company. This will add
16.5 megawatts (MW) to its generating capacity when completed.
Transmission lines from the Kajaki Dam to Kandahar were repaired in early
2001, along with a substation in the city, restoring supplies of
electricity. The Dahla Dam in Kandahar province also has been restored
to operation, along with the Breshna-Kot Dam in Nangarhar province, which
has a generating capacity of 11.5 MW. The 66-MW Mahipar hydro plant
also is now operational.
Turkmenistan supplies electricity to much of northwestern Afghanistan.
In October 1999, Afghanistan announced that it had reached agreement with
Turkmenistan for electricity imports into northwestern Afghanistan,
including power to the city of Herat and the Herat cement plant.
Another transmission line has been built from Turkmenistan to the city of
Andkhoy, and one was under construction in 2001 to Sheberghan.
Electricity has previously been imported from Uzbekistan for Mazar-i-Sharif,
but supplies were cut off during the winter of 1999 due to payment arrears. Regional Pipeline Plans
In January 1998, the Taliban signed an agreement that would allow a
proposed 890-mile, $2-billion, 1.9-billion-cubic-feet-per-day natural gas
pipeline project led by Unocal to proceed. The proposed pipeline would have
transported natural gas from Turkmenistan's 45-Tcf Dauletabad natural gas
field to Pakistan, and most likely would have run from Dauletabad south to
the Afghan border and through Herat and Qandahar in Afghanistan, to Quetta,
Pakistan. The line would then have linked with Pakistan's natural gas grid
at Sui. Natural gas shipments had been projected to start at 700 Mmcf/d in
1999 and to rise to 1.4 Bcf/d or higher by 2002. In March 1998, however,
Unocal announced a delay in finalizing project details due to Afghanistan's
continuing civil war. In June 1998, Gazprom announced that it was
relinquishing its 10% stake in the gas pipeline project consortium (known as
the Central Asian Gas Pipeline Ltd., or Centgas), which was formed in August
1996. As of June 1998, Unocal and Saudi Arabia's Delta Oil held a combined
85% stake in Centgas, while Turkmenrusgas owned 5%. Other participants in
the proposed project besides Delta Oil include the Crescent Group of
Pakistan, Gazprom of Russia, Hyundai Engineering & Construction Company
of South Korea, Inpex and Itochu of Japan
On December 8, 1998, Unocal announced that it was withdrawing from the
Centgas consortium, citing low oil prices and turmoil in Afghanistan as
making the pipeline project uneconomical and too risky. Unocal's
announcement followed an earlier statement -- in August 1998 -- that the
company was suspending its role in the Afghanistan gas pipeline project in
light of the recent U.S. government military action in Afghanistan, and also
due to intensified fighting between the Taliban and opposition groups.
Unocal had previously stressed that the Centgas pipeline project would not
proceed until an internationally recognized government was in place in
Afghanistan. To date, however, only three countries -- Saudi Arabia,
Pakistan and the United Arab Emirates -- have recognized the Taliban
government.
Besides the gas pipeline, Unocal also had considered building a
1,000-mile, 1-million barrel-per-day (bbl/d) capacity oil pipeline that
would link Chardzou, Turkmenistan to Pakistan's Arabian Sea Coast via
Afghanistan. Since the Chardzou refinery is already linked to Russia's
Western Siberian oil fields, this line could provide a possible alternative
export route for regional oil production from the Caspian Sea. The
$2.5-billion pipeline is known as the Central Asian Oil Pipeline Project.
For a variety of reasons, including high political risk and security
concerns, however, financing for this project remains highly uncertain.
In April 1999, Pakistan, Turkmenistan and the Taliban authorities in
Afghanistan agreed to reactivate the Turkmenistan-Pakistan gas pipeline
project, and to ask the Centgas consortium, now led by Saudi Arabia's Delta
Oil (following Unocal's withdrawal from the project), to proceed.
Periodic meetings to discuss the project have continued. It remains
unlikely, however, that this pipeline will be built.
- Afghani Prime Minister Hamid Karzai is former
Unocal consultant
According to Afghan, Iranian, and Turkish government sources, Hamid
Karzai, the interim Prime Minister of Afghanistan, was a top adviser to the
El Segundo, California-based UNOCAL Corporation which was negotiating with
the Taliban to construct a Central Asia Gas (CentGas) pipeline from
Turkmenistan through western Afghanistan to Pakistan.
22 Jan 2002 - Indymedia Mr.
Khalilzad himself knows how compasses change. In the mid-1990's, he briefly
defended the Taliban while working as a consultant for Unocal, the oil
company that was then trying to build a pipeline through Afghanistan.
18 Apr 2004 - PakTribune
-
Unocal Advisor Named Representative to Afghanistan
President Bush appointed a former aide to the American oil company
Unocal, Afghan-born Zalmay Khalilzad, as special envoy to Afghanistan.
3 Jan 2002 - CorpWatch
- Afghanistan plans gas pipeline
Afghanistan hopes to strike a deal later this month to build a $2bn pipeline
through the country to take gas from energy-rich Turkmenistan to Pakistan
and India. The Afghan Minister for Mines and Industries,Mohammad Alim
Razim, said US energy company Unocal was the "lead company" among
those that would build the pipeline.
Monday, 13 May, 2002 - BBC
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