Taliban sign oil extraction deal with Chinese company

KABUL: The Taliban-led administration on Thursday signed a contract with a Chinese company to extract oil from the Amu Darya River basin in northern Afghanistan.

The contract was signed with Xinjiang Central Asia Petroleum and Gas Co (CAPEIC) and is the first major agreement between the Taliban and a foreign company since the group took control of Afghanistan in August 2021.

The move also underscores China’s economic involvement in the country despite a recent attack by Daesh on Chinese nationals at a hotel in Kabul.

“The Amu Darya oil contract is an important project between China and Afghanistan,” China’s Ambassador, Wang Yu, said at a news conference.

Under the terms of the agreement, the Chinese company will invest $150 million a year in Afghanistan, Taliban spokesperson Zabihullah Mujahid said on Twitter.

He said the investment would increase to $540 million in three years and that the contract is valid for 25 years. According to Mujahid, the Taliban will have a 20% stake in the project, which will eventually increase to 75 percent. No country, including China, has officially recognised the Taliban as Afghanistan’s legitimate government.