Post Reply 
 
Thread Rating:
  • 0 Votes - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5
China steps up buying spree in Africa
07-09-2009, 09:48 PM
Post: #1
China steps up buying spree in Africa
China steps up buying spree in Africa
Published: July 9, 2009 at 4:41 PM

China's oil companies, buoyed by the country's foreign exchange reserves that now top $2 trillion for the first time, are on another buying spree in Africa, further challenging the century-long domination of the continent's mineral wealth by Europe's great powers.

So intense is Beijing's drive for wider access to energy resources to fuel China's economic growth that its main state-run oil companies are now competing among themselves.

The Big Three -- China National Petroleum Corp., Sinopec and the China National Offshore Oil Corp. -- are all likely to be among the top bidders when one of West Africa's newest oil producers, the island state of Sao Tome e Principe, which straddles the equator in the Gulf of Guinea, opens up its exclusive economic zone for the first time.

The former Portuguese colony, which once lived off foreign aid and cocoa exports, has reserves estimated at 4 billion barrels.

China Petroleum has a major stake in Sudan, with 40 percent of the Greater Nile Petroleum Operating Co., which controls the Heglig and Unity oil fields, the centerpiece of Sudan's production.

As of next year China Petroleum expects to be producing nearly 600,000 barrels per day in Sudan.

The company was the first Chinese outfit to move into Africa, but the other two are already snapping at its heels. Between them, their African output accounts for some 30 percent of China's oil imports from the region.

Sinopec has sizeable assets in Angola, one of the major sub-Saharan producers that is only now emerging from one of Africa's longest-running civil wars. Sinopec also has holdings in Congo-Brazzaville, Gabon, Sudan and Algeria. On June 26 it gained its first footholds in Nigeria (long dominated by U.S. and European oil companies), Cameroon and Gabon (still largely a French preserve) when it acquired Geneva-based producer Addax Petroleum Co. for $7.1 billion.

China National Offshore has big plans for West Africa, where the Gulf of Guinea is one of the three most important deepwater zones in the world. Overall production there is expected to soar over the next decade amid rapid expansion in Nigeria and Angola.

The company operates an offshore concession in Equatorial Guinea, one of the most impoverished African states and like so many others, ruled by dictatorial and corrupt strongmen.

China National Offshore is now endeavoring to establish a regional operation in Africa, having acquired drilling blocks in Nigeria's huge Akpo field and in the Rio Muni offshore in Equatorial Guinea.

Its efforts to move into Nigeria and elsewhere have so far been stymied, but it is pushing to acquire the holdings of the United States from Kosmos in Ghana's Jubilee field. But it's facing stiff competition from Royal Dutch/Shell and ONGC Videsh of India.

The United States and former colonial powers Britain and France still play "a huge role in African politics and geopolitics behind the scenes," a position that "has largely gone unchallenged since the end of the Cold War" more than a decade ago, according to a recent analysis by Jane's Intelligence Review.

But that's all in the mix now, as China and India, the other burgeoning Asian economic titan, scramble for Africa's oil and mineral wealth.

"Western firms have dominated the economies of most African states since independence, through their interests in oil, gas, copper, cotton and consumables, even though Western investment in Africa as a whole has been tiny in comparison with that of the rest of the world," Jane's added.

"This easy domination of the region by Western governments and companies could therefore be challenged by China with relatively little effort."

http://www.upi.com/Energy_Resources/2009/0...61931247172062/
Find all posts by this user
Quote this message in a reply
Post Reply 


Possibly Related Threads...
Thread: Author Replies: Views: Last Post
  World faces hi-tech crunch as China eyes ban on rare metal exports Guest 0 428 08-28-2009 11:22 AM
Last Post: Guest
  China food safety remains "grim" --- 0 478 03-03-2009 12:27 PM
Last Post: ---
  China says one-child policy helps protect climate --- 4 1,492 02-24-2009 04:46 AM
Last Post: jack
  China down to 12 days worth of coal - report --- 1 746 04-26-2008 02:24 AM
Last Post: yeti

Forum Jump:


User(s) browsing this thread: 1 Guest(s)