The Afghanistan Government has signed contracts with mining and investment group Centar and its operating company Afghan Gold and Minerals Co to develop mines in the northern region of the country.
The contracts were signed as part of the government’s plans to develop the country’s mineral reserves, Reuters reported.
Signed in Washington, US, the deals are aimed at developing two sites in the Badakhshan and Sar-e Pul provinces, which could have significant gold and copper deposits, and reviving projects that have been neglected for years.
The US and Afghan authorities intend to develop mineral resources estimated to be worth around $1tn in an effort to boost Afghanistan’s economy.
Afghanistan Gold and Minerals chairman and president Sadat Naderi was quoted by the news agency as saying: “This investment will be transformative for Afghanistan. Once we begin mining, the country will benefit from major investments in infrastructure as well as fiscal revenue from our projects.”
The development of Afghanistan’s mining sector has been impeded by several factors, including security challenges, accusations of corruption and a lack of developed infrastructure.
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Despite previously signing a deal with China’s state-run firm China Metallurgical Group for the development of the Mes Aynak copper project, it has since failed to provide the desired results.
Of the two projects in the new deal, the copper project in Balkhab district in Sar-e Pul is an early stage exploration project.
According to Centar, the project is spread across 500km² and its development is scheduled to commence next year.
Citing an unnamed spokesman for Afghanistan mining ministry, Reuters reported that the contract for the project is valid for a period of 30 years and will involve an investment of $56m.
Located in Badakhshan in north-eastern Afghanistan, the second project is a gold mining operation.
The contractor will explore and develop the area which contains known gold deposits.
Exploration is expected to start next year.
According to a ministry spokesperson, the second project would run for 30 years and require an investment of $22m.