Afghan Mining Opportunity Mining Sector Overview Afghan Opportunity Afghanistan has substantial mineral and petroleum deposits: Copper (Aynak = 11.3 million tons) Iron (Hajigak = 1.8 billion tons) Oil and Gas estimated at 36 trillion cubic feet and 3.6 billion barrels respectively Precious Stones (over 120 occurrences) Precious Metals (112 gold occurrences) Other (aggregates, etc.) In 2002, the US Geological Society (USGS) compiled a list of 1,079 Afghan mine and mineral occurrences Still under explored – High probability of finding significant additional reserves Currently mining is less than $100 million in Afghan GDP (<1%) Opportunity to more than double Afghan national revenue in mid-term 2009/10 total government revenue = $1 billion Up to $1 trillion in mining reserves (according to President Karzai) – Not including extraction Aynak and Hajigak alone could eventually create revenues of $1 billion+ annually All minerals located on or under the surface are the sole property of the government Significant generator of jobs and economic development Value chain and building aggregates can have near-term COIN impact The Afghan mining industry consists of several different sectors including copper, iron, oil, gas, precious stones and metals and other items such as aggregates. As has been recently reported, Afghanistan has substantial mineral and petroleum deposits. In fact, in 2002 the US Geological Society compiled a list of 1,079 individual mine and mineral occurrences throughout the country. Additionally, due to the last three decades of war and associated lack of capacity and infrastructure, the country is still viewed to be relatively under explored and there is a high probability of finding significant additional reserves. There is, however, a very large gap between identified reserves and the associated economic value being created. Currently mining represents less than $100 million in Afghan Gross Domestic Product, which equates to less than 1%. The opportunity for Afghanistan in this sector is massive. Successful extraction from key locations can more than double mid-term annual revenue in the country. It has been suggested that reserves may exceed $1 trillion. This does not include the cost of extraction. Regardless, the opportunity is very large. Along with increasing the revenue of the country, literally tens of thousands of jobs will be created and the skills needed in mining can also be transferable to other sectors of the economy. Overall, leveraging the mining sector will be critical to Afghanistan achieving self sufficiency in the future. Next Slide Please Significant enabler of Afghan self sufficiency

Primary Mining Sectors Copper Iron Current interest is focused on Anyak, the Darband, and the Jawkhar prospects in southeastern Afghanistan. Aynak is estimated at 11.3 million tons and is expected to employ up to 40,000 people (directly and indirectly) when fully operational. Expected to generate $350+ million in taxes to GIRoA annually. Previously, copper has been mined from the following Provinces: Heart, Farah, Kapisa, Kandahar and Zabul. Aynak Hajigak iron ore deposit located over 100km west of Kabul is the best known deposit. 1.8 billion ton of iron ore with a concentration of approximately 62%. World class opportunity (primary ore accounts for 80% of the ore). Bloomberg – “Afghanistan Invites New Iron Mine Bids Over Transparency Issues”. Hajigak Source: Ministry of Mines Source: Ministry of Mines Oil and Gas Precious Stones and Metals Gas fields have been identified in several locations including yateem Taq, Khwaja Gogardak, Khwafa Bolan, Zigdeli, Bayan Ghor and the outskirts of Sherber Ghan. 500 total fields (8 identified having the geological capacity 0f 180 billion cubic meters of gas). Sar-e-pul oil reserves has been identified (44.5) million tons with the extractable reserves reaching 14.5 metric tons. Significant Afghan opportunities exist in all of identified sectors: In Copper, Aynak, which is located 30Km east of Kabul, is expected to generate revenue of more than $350 million annually In Iron, Hajigak, which is located over 100Km west of Kabul, has a potential to generate revenue of more than $1 billion annually In Oil and Gas, significant reserves are located in the north, near the Amu Darya Basin. In Precious Stones, USAID estimates there is an opportunity to grow gemstone revenue from $3 million to $300 million annually. Marble is another significant opportunity in the broader stone sector. Next Slide Please Gemstone varieties include emerald, sapphire, aquamarine, tourmaline, kunzite, ruby, lapis lazuli, spinal and more. Gold is another precious metal opportunity. Opportunity to grow to gemstones from $3 million to $300 million per year (as per USAID) with improved extraction and processing (85% exported for processing). Marble is another key focus area. Source: USGS Source: British Geological Survey and Ministry of Mines 3

Opportunities Blanket The Country Copper Iron Source: Ministry of Mines Source: British Geological Survey and Ministry of Mines Oil and Gas Precious Stones and Metals Sir, this slide depicts the already identified reserves. As you can see, mining opportunities literally blanket the country. We are working with the Information Dominance Center to upload all US Geological Society identified mineral occurrences into their systems. Next Slide Please Source: British Geological Survey and Ministry of Mines Source: USGS 4

TFBSO Prioritized Mineral Sites 16 TBD 18 TBD 17 TBD TBD 11 1 15 7 12 8 20 TBD 4 5 13 10 14 2 19 3 The Task Force for Business and Stability Operations, otherwise known as the Brinkley group, has also assessed the mining industry and has had discussions with the US Geological Society to determine the best opportunities to focus on going forward. The top 20 priority locations are shown in the shaded boxes on this slide. Additionally, the US Geological Society agrees with the assertion that “At least 70% of Afghanistan’s mineral resources are yet to be identified”, which means many more priority sites are likely to be identified in the future. 9 6 5

Recent Mining Progress/Issues Recently-gazetted laws and new mining regulations approved by the cabinet on December 14 should improve the regulatory environment New Mining Minister Shahrani Afghanistan’s 24th Minister of Mines First with an economic and business background Keenly interested in developing sector with an eye on investment promotion Creation of Infrastructure and Economic Development cluster Chaired by Minister Shahrani Key priority is to prepare Afghanistan for large scale investment in extractive industries Mining sector will receive heightened level of focus Issues: Hajigak tender delayed, per newspaper reports, to ensure transparency Aynak production delayed Lack of established “value-chain” infrastructure Sir, progress continues to be made in the sector, but issues also persist. Recently gazetted laws and the appointment of Minister Shahrani as the new Mining Minister will be positives for the overall mining sector. Minister Shahrani is keenly interested in developing the sector and is also the chair of the new Infrastructure and Economic Development cluster, which will heighten the level of focus on mining related activities. The primary issues that need to be addressed are the re-bidding of the Hajigak tender, which was reportedly suspended due to transparency issues, addressing production delays at Aynak, creating more competitive terms and conditions for future tenders, and more aggressively pursuing value chain infrastructure opportunities. Next Slide Please

IJC Mining Considerations Continue to support Deputy Undersecretary Brinkley’s business support task force, which will begin investment support activities for industrial minerals operations in 2010 Synchronize with USAID is assessing the “mines to market” value chain Creation of Afghan business associations Product finishing training Technology development and equipment supply Public private partnerships, market linkages, and industry infrastructure strengthening Work with IPA and PRTs to analyze potential needs at the provincial and district levels Explore CERP opportunities accordingly Leverage shorter term COIN opportunities to set the stage for exploitation of this sector in the future Develop a positive I/O campaign to communicate the value of this important market Finally Sir, from an IJC perspective, we can focus on several areas to have a positive impact on this sector. We can continue to support Deputy Undersecretary Brinkley’s task force, which will begin investment support in the sector in the coming months We can synchronize with USAID is assessing the “mines to market” value chain. From an immediate COIN perspective, the value chain offers significant benefits. To effectively extract minerals requires a detailed supply chain infrastructure including roads, power and water to name a few. We can prioritize these opportunities and put them in place now We can work with the IPA and PRTs to analyze potential mining opportunities at the provincial and district levels and be prepared to mobilize CERP as appropriate We can pursue shorter term COIN opportunities in the construction markets. Aggregate and construction materials, which can usually be extracted at much less cost, will be needed now as part of our current development efforts in the country; and lastly We can also support GIRoA in developing a positive I/O campaign to communicate the value of this important market Sir, this concludes my briefing. Subject to any questions, I will be followed by _________________________________. Bottom Line: Mining is one of the most important sectors in Afghanistan and should be pursued to the greatest extent possible