Skip to main content

China Gets Another Shot at Mideast Energy After Total Leaves Iran

By 

Mohammed Sergie

August 28, 2018, 2:30 AM GMT+5:30

Middle East accounts for more than 40% of China’s oil imports

China National Petroleum is partner in Iran South Pars project

Total SA’s withdrawal from Iran’s giant South Pars gas field has given China another chance to secure a stake in the world’s most coveted energy assets: abundant and low-cost Middle Eastern oil and gas.

Chinese companies have invested in Iraq, the United Arab Emirates and Iran in recent years, and have expressed interest in oil and gas projects in Saudi Arabia and Qatar. The resumption of sanctions by the U.S. on Iran has presented new opportunities, starting with the option to take control of South Pars after Total failed to secure an exemption from the U.S. penalties. Chinese companies are also interested in a $1.5 billion refinery upgrade in Iran.

Read: U.S.-Iran Sanctions Give China Lead in World’s Top Gas Field

The tilt east has been in the making for more than a decade as China’s economic expansion accelerated. U.S. and European companies still dominate the Middle Eastern oil and gas business, but their home countries are less reliant on the fuel. China, and other fast-growing nations in Asia, need the energy, and are increasingly bidding for concessions and joint ventures in the Persian Gulf region.

Go East

Middle East oil producers continue to dominate in China

Source: BP Statistical Review of World Energy

China’s demand for oil almost doubled in the past decade, while Middle East producers kept their market share at about 43 percent, according to BP Plc’s Statistical Review of World Energy data. Natural gas consumption is also booming as China strives to improve air quality by reducing its reliance on coal in favor of the cleaner fuel, BP said in its latest report in June.

HERE ARE SOME OF CHINA’S FORAYS INTO MIDDLE EAST ENERGY: IranChina National Petroleum Corp., which has a 30 percent stake in Phase 11 of South Pars, will become the majority shareholder: Mohammad Mostafavi, National Iranian Oil Co.’s investments and business head; CNPC declined to commentU.A.E.Shanghai-based CEFC China Energy Co. and CNPC won a combined 12 percent of Abu Dhabi’s $22 billion oil concession last yearIraqCNPC is developing Iraq’s biggest oil field, together with BP. China Petroleum & Chemical Corp., known as Sinopec, also pumps oil in the Kurdish regionSaudi ArabiaSinopec is a partner in a refinery in the kingdom. China’s sovereign wealth fund discussed investing in the Saudi Aramco initial public offeringQatarChinese companies have expressed interest in Qatar’s new liquefied natural gas projects that will boost the country’s output by 30 percent 

Chinese companies have a long way to go to displace Western companies that have operated in the Middle East for over a century. They will still need Western expertise and are partnering with the majors such as BP and Total to extract the oil, and then are using ownership stakes to secure the supplies.

Read: China Tries to Become Big Player in Middle East Oil

Regional Breakdown

Saudi Arabia led peers in crude exports to China last year

Source: BP Statistical Review of World Energy

— With assistance by Aibing Guo


https://www.bloomberg.com/news/articles/2018-08-27/china-gets-another-shot-at-mideast-energy-with-total-s-iran-exit

Comments

Popular posts from this blog

Balochistan to establish first medical university

https://www.dawn.com/news/1366135

The Newspaper's Staff CorrespondentOctober 25, 2017QUETTA: The provincial cabinet on Tuesday approved the draft for establishing a medical university in Balochistan.Health minister Mir Rehmat Saleh Baloch made the announcement while speaking at a press conference after a cabinet meeting.“The cabinet has approved the draft of the medical university which would be presented in the current session of the Balochistan Assembly,” he said, adding with the assembly’s approval the Bolan Medical College would be converted into a medical university.Published in Dawn, October 25th, 2017

China’s 'Digital Silk Road': Pitfalls Among High Hopes

https://thediplomat.com/2017/11/chinas-digital-silk-road-pitfalls-among-high-hopes/


Will information and communication technologies help China realize its Digital Silk Road?By Wenyuan WuNovember 03, 2017In his speech at the opening ceremony of China’s 19th Party Congress, President Xi Jinping depicted China as a model of scientific and harmonious development for developing nations. Xi’s China wants to engage the world through commerce but also through environmental protection and technological advancement. This includes Beijing’s efforts to fight climate change with information and communication technologies (ICTs) that it plans to export along its “One Belt One Road” initiative (OBOR). Xi may have ambitious plans, but could China be throwing up obstacles in its own way?In his speech, the Chinese president emphasized the need to modernize the country’s environmental protections. The Chinese state is taking an “ecological civilization” approach to development and diplomacy, with a natio…

Germany’s Siemens sets up Belt and Road office in Beijing

https://gbtimes.com/germanys-siemens-sets-up-belt-and-road-office-in-beijing
Germany’s Siemens sets up Belt and Road office in Beijingby Janne Suokas Mar 23, 2018 15:20 TRADEINVESTMENTBELT AND ROAD INITIATIVEGerman industrial and engineering group Siemens will set up a Belt and Road office in Beijing. surberFlickrCC BY 2.0
German industrial and engineering group Siemens will set up an office in Beijing to boost international cooperation under China’s Belt and Road initiative, the company said on Friday.The move will help strengthen Siemens’ cooperation with Chinese and international companies and expand business opportunities brought about by the Belt and Road initiative, according to the company’s statement.The Belt and Road initiative is China’s ambitious project to boost trade and infrastructure investment in more than 65 countries along the ancient Silk Road trade routes from Asia to Europe and Africa.Siemens said it had already partnered with hundreds of Chinese companies in overse…