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Cablegate: Afghanistan: New Oil and Gas Field Tender Expected in Three

VZCZCXRO2381
PP RUEHDBU RUEHIK RUEHPOD RUEHPW RUEHYG
DE RUEHBUL #3788 3130243
ZNR UUUUU ZZH
P 090243Z NOV 07
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC PRIORITY 1383
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC 0555
RUCNAFG/AFGHANISTAN COLLECTIVE
RUEHZG/NATO EU COLLECTIVE
RUEKJCS/OSD WASHINGTON DC
RUEKJCS/JOINT STAFF WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RUEABND/DEA HQS WASHINGTON DC
RHMFIUU/HQ USCENTCOM MACDILL AFB FL
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUCNDT/USMISSION USUN NEW YORK 4270
RUEHFR/AMEMBASSY PARIS 2992
RUEHML/AMEMBASSY MANILA 1642
RUEHBY/AMEMBASSY CANBERRA 0285
RUEHOT/AMEMBASSY OTTAWA 1410
RUEHNE/AMEMBASSY NEW DELHI 7168
RUEHJA/AMEMBASSY JAKARTA 0069
RUEHRL/AMEMBASSY BERLIN 2124
RUEHUL/AMEMBASSY SEOUL 0091
RUEHLO/AMEMBASSY LONDON 3778
RUEHKO/AMEMBASSY TOKYO 1967

UNCLAS KABUL 003788

SIPDIS

DEPT FOR SCA/FO, SCA/RA, AND SCA/A (A/S BOUCHER, GASTRIGHT,DEUTSCH)
DEPT PASS AID/ANE, OPIC
DEPT PASS USTR FOR GERBER AND KLEIN
DEPT PASS OPIC FORZAHNISER
DEPT PASS TDA FOR STEIN AND GREENIP
CENTCOM FOR CG CFC-A, CG CJTF-76, POLAD, JICENT
NSC FOR JWOOD
TREASURY FOR ABAUKOL, BDAHL, AND MNUGENT
MANILA PLEASE PASS ADB/USED
PARIS FOR OECD/ENERGY ATTACHE
OSD FOR SHIVERS, SHINN
COMMERCE FOR DEES, CHOPPIN, AND FONOVICH
TOKYO ALSO FOR AID COUNSELOR AANENSON

SENSITIVE
SIPDIS

E.O. 12958 N/A
TAGS: ENRG EPET KPWR EAID PGOV AF
SUBJECT: AFGHANISTAN: NEW OIL AND GAS FIELD TENDER EXPECTED IN THREE
MONTHS

Sensitive but Unclassified

1. (SBU) The Afghan Ministry of Mines intends to issue a tender for
exploration of several blocks of the Amudarya Oil and Gas basin in
north-western Afghanistan in February or March 2008 Post learned at
the recent Oil and Gas Working Group meeting November 8. Note: The
Amudarya basin is also where the fields for the proposed Sheberghan
gas powered plant are located. However, the Sheberghan fields are
not part of this tender. End Note. According to Norwegian Agency
for Development and Cooperation (NORAD) consultants, the exploration
and eventual resource extraction will occur under the rubric of
Production Sharing Agreements (PSA)'s negotiated with the IRoA,
paving the way for private sector investment in Afghanistan's
natural resources sector.

2. (SBU) Norway and the World Bank have also been working with the
Ministry of Mines to draft a Hydrocarbons Law and accompanying
regulations to ensure "rules of the game" are in place for the
sector as soon as possible. After a rewrite, the law is currently
under review and it and its accompanying regulations, are expected
to be ratified in the near future. It remains unclear however if
the ratification will occur prior to March 2008. Lack of
ratification will not delay issuance of the tender, but may impact
contract negotiation and/or exploration timelines.

3. (SBU) According to NORAD and WB reps who recently met with him,
Minister of Mines Adel is also eager to include oil exploration in
the northeastern Afghan-Tajik basin in the proposed tender. He
appears to be motivated by recent press reports claiming Tajikistan
has retained the services of Tethys Petroleum to explore its half of
the basin. NORAD consultants tell us it is unlikely the tender will
be expanded and cite two reasons. First, NORAD, not the Ministry
has the authority to decide if the tender's scope can or will be
expanded. Second, NORAD believes that there is insufficient time to
analyze and properly package the available Afghan-Tajik basin data
in time for a March 2008 tender announcement. Post will continue to
report developments as they occur. Note: Post's Oil and Gas Working
Group meets approximately every six weeks and is attended by
representatives of the Ministry of Mines, World Bank, Norwegian
Embassy and its development arm NORAD, as well as ECON, USAID and
the U.S. Embassy's Afghanistan Reconstruction Group (ARG). End Note.


Wood

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