Tags: Afghanistan | Russia | china | oil | pipline | taliban

Afghan Oil Pipeline Bad Investment for US

Afghan Oil Pipeline Bad Investment for US

Natural gas transmission pipeline, Fengle Town of Wuwei City, northwest China's Gansu Province. (Xinhua, Han Chuanhao/AP)    

Monday, 12 December 2016 11:22 AM Current | Bio | Archive

All of today’s wars have to be looked at in the context of oil and gas supplies. There is intense competitive pressure between Russia and China on the one hand, and the U.S. on the other. Each side fights, either with weapons or with the checkbook — for the ever-dwindling supply of natural resources.

Buying resources with a checkbook (as practiced by the Chinese) has turned out to be much more cost effective, as Iraq and Afghanistan prove. The time when the U.S. had a virtual oil monopoly in the world has long passed.

It all started in December, 1991 with the collapse of the Soviet Union and the subsequent independence of the oil and gas rich Asian republics of Azerbaijan, Kazakhstan, and Turkmenistan.  

U.S. oil companies estimated that there may be 200 billion barrels of oil in the ground, making it a tempting area to get involved in.

As a result, a U.S. company, Unocal, (since acquired by Texaco) along with several partners, including an Argentine and a Saudi oil company, signed agreements with Turkmenistan to build gas and oil pipelines in 1995.

In 1996, this agreement got further extended to include building a 36-inch natural gas pipeline from Turkmenistan to Pakistan, via Afghanistan. This line was to be extended later to India to serve a huge market with hundreds of millions of energy-starved people.

This required an agreement with the Taliban, the then effective rulers of Afghanistan. Unocal invited a Taliban delegation to their corporate head quarters in California. This resulted in an agreement signed in January, 1998 to allow the pipeline to pass through their country.

In March, 1998 however, Unocal announced a delay in the pipeline project due to an ongoing civil war in Afghanistan. This tempted the Taliban — on April 30, 1999 — to conclude their own deal with Pakistan and Turkmenistan, thus excluding the U.S.

This led the U.S. government to retaliate, placing sanctions on Afghanistan.

In a final meeting with the Taliban, a U.S. delegation delivered an ultimatum, "[E]ither you accept our offer of a carpet of gold, or we bury you under a carpet of bombs."

The Taliban did not relent, and the bombs started falling on Oct. 7, 2001 — following the Sept. 11, 2001 attacks.

The war has now dragged on for 15 years, and no end is in sight. In the beginning the U.S. helped to "democratically elect" a U.S. citizen and former project engineer of Unocal to help stabilize the country and to make it governable. Alas, that did not happen due to massive insurgency by elements of the Taliban and al-Qaida fighting U.S. troops.

The pipeline project, as a result, kept being postponed. However, this did not stop the Chinese. They built their own pipeline between Kazakhstan and China, which actually started to transport oil in the spring of 2011.

Despite all the military problems, there are people who still have plans for a U.S. pipeline.

The latest trial balloon is to split Afghanistan in two, and then use the northeastern part, which is more peaceful due to a difference in the ethnicity of the population, and use this area as the transit point for the pipeline, which, in order to protect it from sabotage, will be installed underground.

In the meantime: In November 2011, Afghanistan’s Ministry of Mines awarded 80 percent of the Hajigak large iron ore deposit to a consortium of Indian firms, and the other 20 percent to Canada’s Kilo Goldmines Ltd. This area is supposed to hold 1.8 billion metric tons of iron ore.

This comes on top of the earlier award of the Mes Aynak project to a Chinese company after it paid $3 billion for the concession. This is credited to potentially being the largest copper mine in the world. All in all, the U.S. government estimated that Afghanistan sits on top of about $1 trillion worth of mineral wealth. Where is our share?

By the way, the simplest way to ship natural gas to energy starved India is to liquefy plenty of natural gas from Qatar and Saudi Arabia and ship it via the Persian Gulf to Mumbai (Bombay) India. Forget about Afghanistan.

Hans Baumann is a licensed engineer in four states and a member of Sigma Xi, the Scientific Research Society. He is an adviser to the dean of the University of New Hampshire Business School. Baumann has published manuals on valves and was a contributor to many works including the "Instrument Engineers' Handbook" and the "Control Valves Handbook." He has also published several books on business management and German history. His book "Hitler's Escape," suggests that Adolf Hitler did not commit suicide and survived World War II. For more of his reports, Go Here Now.



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The war has dragged on for 15 years. Due to massive insurgency by elements of the Taliban and al-Qaida fighting U.S. troops, the pipeline project kept being postponed. The Chinese built their own pipeline between Kazakhstan and China, which actually started to transport oil in the spring of 2011.
china, oil, pipline, taliban
Monday, 12 December 2016 11:22 AM
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