The contracts signed in Washington would help revive the stalled projects with the company officials who signed the contracts believing that the responsible development of Afghanistan’s minerals deposits would be truly transformative for the country.
Ian Hannam, a former JPMorgan Chase & Co. banker and the co-owner of Centar Ltd., signed the contracts with the Afghan officials during a ceremony held in the Embassy of Afghanistan in Washington.
Afghanistan’s acting finance minister Mohammad Humayoun Qayoumi and the minister of mines and petroleum Nargis Nehan had attended the signing ceremony.
According to Centar Ltd., the exploration works in the two sites would begin next year, covering a 500 square kilometer area for the exploration of copper in Balkhab in North of Afghanistan.
It is estimated that the Balkhab copper mine could contain more than 100 metric tons of copper and by-products.
At the same time, the company will also start development of Badakhshan Gold project in Northeast of Afghanistan in an area about twice the size.
The exploration works would start in the two sites with the support of Centar’s local partner, Afghan Gold and Minerals led by Afghan entrepreneur and former Minister of Urban Development and Housing Syed Sadat Mansoor Naderi.
In response to the concerns raised by Global Witness regarding the involvement of a former minister as a local partner in the projects, five years before leaving the post, Centar CEO Bradley Barnett said the company obtained its concession in 2012, before Naderi became a minister, and has not violated the law.
“That is the interpretation that we have and that everybody that we consulted has,” he said.
In the meantime, the Office of the Senior Advisor to the President in Banking and Finance, in a statement said “Recently, a number of CSOs have come out against the Badakshan Gold and Balkhab Copper Contracts due to the involvement of the former Minister of Urban Development and Housing Mr. Naderi.”
Rejecting the assessment and interpretation of the CSOs, the statement further added that “The GoIRA is committed to transparent processes. We therefore checked this article with our legal counsel. In particular, these articles prohibit persons referred to Paragraph 2, but does not explicitly prohibit such persons from having direct or indirect benefits, as defined in Paragraph 5. This is a legal, but important, distinction. Furthermore, the purpose of this article was to prohibit senior officials from negotiating a contract and immediately winning a bid upon leaving office. This is not the case here. Mr. Naderi’s consortium was clearly selected as the preferred bidder prior to the establishment of the current government. Even so, both Mr. Naderi and his father resigned from Parliament to ensure that there were no further perceptions of a conflict of interest.”
In the meantime, a spokesman for the Ministry of Mines and Petroleum Abdul Qadeer Mutfi, told reporters in Kabul that all legal procedures have been considered in Balkhab copper mine and Badakhshan gold mine projects and there is no legal issue with the contracts, emphasizing that the ministry recognizes Integrity Watch’s allegations regarding the projects as baseless.
He said the bidding process of Badakhshan gold and Balkhab copper mines were announced in 2012 under the presidential decree through national and international media and the International Conference on Mines and Money.
Mutfi further added that the Turkish Afghan Mining Company will invest about $22 million in the first three years of exploration of Badakhshan gold mine while Afghan Gold Minerals Company would invest $56 million in Balkhab copper mine in the first three years of exploration