US "Discovers" Nearly $1 Trillion In Mineral Deposits In Afghanistan

Tyler Durden's picture

And there are those who wonder why the US has spent countless dollars and thousands of dead soldiers protecting a few desolate mountain passes in Afghanistan. And no, it turns out it is not just the opium trade. The NYT reports that "The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials." The article continues, "The previously unknown deposits — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium — are so big and include so many minerals that are essential to modern industry that Afghanistan could eventually be transformed into one of the most important mining centers in the world, the United States officials believe." Ah yes - "previously unknown." Yet the punchline of the piece : "The vast scale of Afghanistan’s mineral wealth was discovered by a small team of Pentagon officials and American geologists." Because $1 trillion worth of minerals just lie there waiting to be discovered almost 10 years after the initial incursion. Next thing you know FCX already had an entire mining infrastructure in place just in case a contingency like this miraculously occurred. In the meantime, look for gold prices to plunge as the newly uncovered gold deposits are rumored to be "large" enough to once again refill Fort Knox and to push the supply curve three miles to the right.

More on this truly "stunning" discovery:

The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials.

he previously unknown deposits — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium — are so big and include so many minerals that are essential to modern industry that Afghanistan could eventually be transformed into one of the most important mining centers in the world, the United States officials believe.

An internal Pentagon memo, for example, states that Afghanistan could become the “Saudi Arabia of lithium,” a key raw material in the manufacture of batteries for laptops and Blackberries.

The vast scale of Afghanistan’s mineral wealth was discovered by a small team of Pentagon officials and American geologists. The Afghan government and President Hamid Karzai were recently briefed, American officials said.

While it could take many years to develop a mining industry, the potential is so great that officials and executives in the industry believe it could attract heavy investment even before mines are profitable, providing the possibility of jobs that could distract from generations of war.

The value of the newly discovered mineral deposits dwarfs the size of Afghanistan’s existing war-bedraggled economy, which is based largely on opium production and narcotics trafficking as well as aid from the United States and other industrialized countries. Afghanistan’s gross domestic product is only about $12 billion.

“This will become the backbone of the Afghan economy,” said Jalil Jumriany, an adviser to the Afghan minister of mines.

Is it time for "Confessions of an Economic Hit Man: Part 2, the 21st Century paradigm"? Yet presumably not all is as expected: "Yet the American officials also recognize that the mineral discoveries will almost certainly have a double-edged impact. Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country."

Which is why it will be best to have the US military not only stay in Afghanistan indefinitely but to get a million man reinforcement surge. After all now that it is finally becoming clear that the most recent US state is located somewhere in the middle of Asia, things are about to get a whole lot more interesting.

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ZerOhead's picture

Wow... what an incredibly fortunate development.

Lucky us... err... them!

Hephasteus's picture

LOL. Yes quickly sell all your gold as this stuff will rain down from the sky during missile attacks. LOL I knew this was going to be a doozy of a bullshit story but I never would have thought of this.

ColonelCooper's picture

I sold all of mine immediately after reading this story.  I had to take 60% of spot, but I thought it was for the best.

I'll try to sell my silver tomorrow, but I doubt I'll find a buyer.

septicshock's picture

 

I did some quick math into what this would mean for my gold investments.  Currently, 160,000 tonnes of gold has been mined and is above ground... meaning 161 million kilograms, or a little over 5 billion ounces.  A total worth of over 6 trillion dollars distributed amongst 6 billion people, central banks, etc...  

This find in afghanistan of "1 trillion" dollars in mineral wealth encompasses copper, gold, lithium, iron, etc...   Even if we assume 25% or 250 billion dollars of this is in gold, underground, in a war-ridden country that currently has no infrastructure to support mass scale mining... we are talking about a 4% increase in the gold supply.   This is a drop in the bucket.

A mere 4% increase is nothing when gold is so undervalued.  Total world gold will now go from current worth of 6 trillion to 6.25 trillion.  I am quite sure this little "DISCOVERY" was happy coincidence in the face of possible destabilization from currency failure.  I quite appreciate law and order that comes from stable governments, but I also don't like being manipulated.  JP Morgan with all its short positions must be exuberant right about now...  jumping for joy at the windfall that they will make from a temporary drop in prices due to this "discovery."   After JP unloads their short positions after a massive outflow of gold investments from the fear of supposedly increased supply, it will go long this time. They will bring up how the find is miniscule in the big picture and that the mine will not become productive for at least 10 years and how current demand will continue to force prices sky high.

Fool me once, shame on you.  Fool me twice, shame on me.   I think I will be adding to my position...  I think the market will likely correct a good 10% to perhaps 20% with this news... at which time, I will double down.

I can't eat gold, but I can surely buy ambrosia when people start opening their eyes to fiat money

 

Fish Gone Bad's picture

This is just wonderful news.  Four men drove around and figured all this out.  Of all the people in the world that have come to that piece of hard scrabble, Four men figured this out.  That is just amazing.  And they even could put a price on it, that is just incredible.  I will not be able to sleep at night, knowing that four men have saved the world. </sarcasm>  For the life of me, I do not understand why people think gold is so freaking hard to find.

TBT or not TBT's picture

Can we do a Lexis/Nexis on whether a small team of geologists sent there by the British Empire back in Kiplings's time didn't announce some big mineral finds, just as it was becoming clear they ought to leave?

Sean7k's picture

They probably lacked the satellite capability of "seeing" formations and mineral types that allow us to identify deposits. However, I am sure we never pointed them at Afganistan until just now...

knukles's picture

By my feeble reckoning, there've been a number of articles in the press over the last year or so concerning Significant, Major Capital Investments in Afghani Mining Operations by the Chinese.  Complete with real, armed Chinese Troops for Security/Protection.

Leave it to the Reformed Ex-Commie Newbie Capitalistia Chinese to Rediscover the Joys of Mercantilism.

jeff montanye's picture

gold up $3.80 on the news.

pip's picture

It doesn't mention silver, but the question is will they use this and/or some pumped up economic figures to get silver down to around $16.50 to knock out the possibility of calls at that strike taking physical delivery, or will they be satisfied knocking out the big call at $18?

Hdawg's picture

Agreed, good post.

 

"They will bring up how the find is miniscule in the big picture and that the mine will not become productive for at least 10 years and how current demand will continue to force prices sky high."

I think the point is they are losing control of the commodities derivatives ponzi and this will give them a steady stream of uncorroborated media (amoungst other agenda forfilling reasons) to be able to move markets for the insiders.  The same will happen in Africa.

Free markets are dead.  Total Fascism.  

Doug's picture

Well, not the "exact" story... this time it's USAx. 

Doug's picture

This is going to be fun.

charles platt's picture

Of course the entire story could be placed specifically to _encourage_ a drop in the price of gold. After all, none of the other ploys seems to have worked.

Pegasus Muse's picture

JP Morgan with all its short positions must be exuberant right about now... jumping for joy at the windfall that they will make from a temporary drop in prices due to this "discovery."

JPM probably had a hand in developing the fabrication.

caconhma's picture

The entire region (Afghanistan, Iran, Pakistan, former Soviet states) becomes very unstable. Furthermore, I don't think that Russia and China will allow US  to succeed.

 

Furthermore, following the recent Russian liquidation of the Polish elite, Eastern Europe becomes also very unstable. 

TBT or not TBT's picture

Stability isn't a good thing in and of itself, particularly as regards Iran.  Destablizing it is a top notch plan.

quintago's picture

minerals in Afghanistan? Yawn, this is old news.

Same goes for Africa.

Natural resources are finite in the short term, but discoveries occur on a continuous scale. As we have come to discover, particularly with the BP disaster, the problem is extraction more than it is knowing where the natural resource deposits are located.

AnAnonymous's picture

Old news indeed.

The opening post is a bit misleading.

The discovery was done nearly 31 years ago. This is why US needed to despatch a small team of investigators only to confirm a previously made discovery. The locations, the maps, everything was determined and discovered before.

A bit like a treasure hunt.

This shed a new light on the invasion of Afghanistan as the locations of the ore deposits were known before. Another striking bit of duplicity by the US.

BlackBeard's picture

1 Trillion = very poor ROI.

Temporalist's picture

Exactly what I was thinking.  Perhaps we'll be using a new Afghani currency in the future because one trillion FRNs just aren't what they once were.

I mean it cost over $1 Trillion so far for these 2 wars in Iraq and Afghanistan.  And it has been the longest war in U.S. history.  So even if they ended both wars today...what a terrible return.  And that is excluding the lives wasted.

In my estimation the rare metals are what they are after there.  I'm sure nobody will see the reports on those until the mining has already started.

Broken_Trades's picture

1 Trillion Today

10 Trillion in 10 years.

 

Lithium is a very hard to get after metal these days and will become more and more important in the future.  It also puts on a cool show when you get it wet ;-)

 

PS - I thought Bolivia was the Saudi Arabia of Lithium???

Hdawg's picture

spend a bunch of printed paper in order to get a country...i can't think of a better ROI

doggings's picture

lol, good point, even if it was all here now its negative isnt it?

Kali's picture

Seriously.  Besides, why would the US get the gold or minerals.  Doesn't it belong to the Afghanis?   : )

The Deacon's picture

Now we know why the Taliban wanted to keep everyone out.  They wanted to keep their trillion $ SECRET stash of resources all for themselves!

BUSTED!

Will the US build a new biggest embassy in the world, like the one in Iraq, or just the 2nd biggest?

I am sure they are there temporarily, but why not build some permanent digs in the meantime?

Resource wars.  How many had to die to invade a country and install a puppet.  Ahh, has always been thus, will alwas be thus.

Personally I thought they were there for purely altruistic reasons.

Treeplanter's picture

Knowing what happened in Iraq with oil, other countries will end up with the goodies.  We pay, they play.  

fxrxexexdxoxmx's picture

Darn it. I had hoped once Soros got control of the herion trade I could get hit for $2.00 dollars in the USA.

I have to travel to Vietnam to get my fix for that price.

everyone is bias's picture

now to figure out how to pay off the other 400 billion and we break even this year!

ZerOhead's picture

How about a windfall profits tax from the multinational oil companies in Iraq... remember the other war... the one that wasn't about oil?

http://www.globalexchange.org/campaigns/chevronprogram/chevronprogramint...

jomama's picture

what an amazing happenstance

Hephasteus's picture

So this is the big bullshit story I was waiting for!!!!!

They'll leach a few tons of gold supply from what was stolen and claim it will never end from afghanistan. LOL

ZerOhead's picture

Nah... they'll just strap some ultra visible gold-plated tungsten bars to around a 1,000 camel caravan... and then have them circle around a mountain in front of the MSM cameras!

Inflation problem solved!

ZerOhead's picture

Christ... for a moment I thought it was Karzais' Loya Jirga!

From the NYT article...

"A bleak Ghazni Province seems to offer little, but a Pentagon study says it may have among the world’s largest deposits of lithium."

 

Looks like the fucktards are loading up on lithium to treat Americas next "Great Depresssion". But we cannot in all good conscience allow the Taliban access to their gold or they will certainly come back to take away more of our freedoms that they hate so much... by forcing us to declare Marshall law on ourselves!

"Yet the American officials also recognize that the mineral discoveries will almost certainly have a double-edged impact. Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country."

 

London Banker's picture

I think you mean "Martial Law" (as in military administered law).

ZerOhead's picture

No... Marshall as in Susan Marshall an old ex of mine... she was tough as nails! (Kidding)

Kids... just say no to drugs! 

GoldmanSux's picture

So did Alexander. The common soldier was wise enough to rise up and say 'enough'.

Mitchman's picture

As I said in a different post, this smacks of the typical Administration misdirection at a time when McChrystal said it is going to take longer than he thought, Karzai the Magnificent is making goo goo eyes at the Taliban and even the right-wingers are calling for us to get out.  What credibility do these clowns have? 

knukles's picture

Oh, fuckin'-A, we'll just tell the Whole World staying a while longer is Good for Democracy while we strip mine the forsaken place.  No remedial land reclamation costs.
Cheap Eco-Fix and Endearing Foreign Policy PR. 

I say we Go For It!

Ophiuchus's picture

I wana see those core samples. 

HCSKnight's picture

This could truly be great news and literally a game changer for world trajectory.... 

IF TeamBO &/or the economic power circles dont F this up.

The US now can literally "nation build" because Afghanistan now has a viable, legitimate, economic basis upon which to build a society.

Hopefully the US can help these people build a country free of the dependency upon the opium trade AND Taliban/Islamic-Theocracy elements. 

They should create a company, call it something nationalistic like "Afganning" [Afghan Mining], in which each citizen/family receives equal shares of the company,  and of course it's profits, and those shares can, for the first 100 years, ONLY be bequeathed to their direct descendants - if there are no descendants then the shares revert to the Afghan people to be distributed equally.  That way the next few generations grow up living, learning and receiving the benefits of a capitalist economic system.

It could create a real hope for Afghanistan's national viability and identity, as well as provide the US a noble exit strategy.

I just hope they dont F this thing up....

AMDG
Knight