KABUL, Nov 21: Afghanistan has chosen a Chinese bidder to lease a copper mine, which is possibly the world’s largest, in a contract that is set to bring in hundreds of millions of dollars, the mines ministry said on Tuesday.

The 30-year lease has been offered to China Metallurgical Group Corporation (MCC) to develop the Aynak mine 30 km (20 miles) east of Kabul, an Afghan mines ministry spokesman said.

China’s commerce ministry said in a statement on its website that MCC, a state-owned metal producer and contractor, and Jiangxi Copper Co. would jointly develop the mine.

MCC, expected to sign a deal in the coming months, is to invest around $3 billion to explore and develop the mine, which will also provide jobs for thousands of Afghans, Afghan ministry spokesman Kozhman Ulomi said.

“So far in our history there hasn’t been any contract of this scale,” he said.

The Chinese offer beat bids by Strikeforce, part of Russia’s Basic Element Group; the London-based Kazakhmys Consortium; Hunter Dickinson of Canada; and US copper mining firm Phelps Dodge.

Ulomi said the Chinese group was to make a down payment to the government of $800 million.

The government would also earn millions of dollars in taxation and take a cut, possibly worth up to $200m a year depending on the price of copper, of the annual worth of production.

In terms of the deal, the company is expected to build a coal-fired power station with 400MW capacity, half of which would be for the use of families in Logar province where the mine is located, he said.

Afghanistan, one of the poorest countries in the world, currently produces only 150MW from its main source of electricity, hydropower, due to a general water shortage.

The company also said it would build a railway line from the town of Hairatan on the Amu Darya (Oxys River) bordering Uzbekistan, through Logar and to Torkham on the Pakistan border to export the minerals, the official said. It added that it would construct a town near the mine for 1,500 families.

Other spinoffs would include extra demand for Afghan coal and the creation of small industries using other metal taken from the mine, he said.—AFP