Wahidullah Shahrani, the Afghan Minister of Mines, told TOLOnews on Thursday the that China Metallurgical Group Corporation (CMGCC) requested a review its contract with the Afghan government for the Ainak Cooper Mine project in Logar province. The CMGCC is expected to seek amendments to the contract that would free it of obligations to compensate the Afghan government and develop the area surrounding the mine.
In an exclusive Interview with TOLOnews, Mr. Shahrani said that negotiations with CMGCC officials to review the Ainak Copper Mine project are underway and that he would be visiting China in September to discuss the details of the current contract.
Reportedly, as it stands, the Chinese company is contractually bound to make certain investments in the area of the mine, including the construction of a 400 MW power plant and the building of a railway line from the Shir Khan Port or Hairatan Port up to Torkham for transporting the extracted copper.
However, now four years after the contract was originally established, CMGCC has claimed that the development commitments were conditional and it wants to review the contract again to sort out the differences of interpretation.
"It was expected that the company would build a railway line and power plant, but we did not think the commitments were conditional," Mr. Shahrani said.
The Minister of Mines went on to explain that, according to the contract, CMGCC is obligated to pay $800 million to the Afghan government. But the company is now pressing Kabul to decrease the amount of compensation it owes.
Meanwhile, a number of Afghan economic experts said that the kind of conditional contract CMGCC is trying to enforce would not benefit Afghanistan in any way. The experts blamed President Karzai and Ibrahim Adil, the former Minister of Mines, for not reviewing the contract properly before signing it.