Coming soon: North Afghan crude  

While I enjoy a bit of tinfoil in recent times its been extremely difficult to find much in the way of quality (especially now Rigorous Intuition seems to have given up the ghost entirely). Robert Gottliebsen at The Business Spectator has stepped bravely into the breach however, with a tale of oil and gas in Iraq and Afghanistan - Coming soon: North Afghan crude.

A few years ago, I vividly remember yarning with three members of the Iraq parliament who explained to me that with a $US40 billion investment, Iraq’s oil fields would generate around half the oil output of Saudi Arabia and solve the world oil crisis.

The problem was that security in the region was terrible and wouldn't support investment and, at that time, the warring factions couldn’t agree on the rules of the game. The conversation helped me understand some of the deeper reasons why the Americans went into Iraq.

The war in Afghanistan has always been dominated by the Afghan involvement in the 9/11 attacks on the US, rather than oil. Or so I thought.

A reader this morning sent me a note showing that Afghanistan last week initiated a process that will lead to a bidding round where exploration and production sharing contracts are awarded for hydrocarbon operations in Northern Afghanistan, covering three main areas – Jangalikalan (gas), Juma-Bashikurd (gas) and Kashkari (oil).

Most of the gas and oil fields were discovered in the 1970s during Soviet-led exploration campaigns, except the Angoat oil field which was discovered in 1967. Angoat is the only oil field which has been in sustained production.

The Kashkari field was reported to produce modest amounts of oil for six months in the late 1980s. The Afghan government sets out some reserve figures in the tender documents, but says the Ministry of Mines is “quite optimistic” that the potential figures will be “much bigger”.

Is this Iraq all over again? Those with tin helmets interested in high risk oil and gas projects should contact Mr Hafizullah Afzaly, executive officer of project management unit, Pashtonistan Watt, across from the Ministry of Finance, Kabul, Afghanistan.

Bidders intending to send the application by way of courier service are advised to, as soon as possible, enquire with their local courier services in order to determine the delivering time for courier services to Kabul, Afghanistan as it may require at least one calendar week. Road shows are also being conducted in Dubai, London, Calgary, Houston and Singapore.