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IEA backs Chinese investment
By Richard Fu |
February 19, 2011, Saturday
|
Print Edition
Print Edition
China's state-owned oil companies are operating overseas with a high degree of independence from the government and their investments helped increase global energy supplies, according to a latest report by the International Energy Agency.
The conclusion by the IEA shatters the wide perception that the state oil firms are acting under instructions from the Chinese government and eases concerns their expansion could result in reduced and more expensive supplies to other oil-buying nations.
China's national oil companies (NOCs), including China National Petroleum Corp and Sinopec, have emerged as significant players in global mergers and acquisitions from Africa to Americas in recent years.
"Notwithstanding the tendency of the NOCs, in domestic communications, to cast their overseas activities in terms of support for national energy security objectives, their actions appear mainly to be driven by commercial incentives to take advantage of available opportunities in the global marketplace," said the report, released on Thursday by Paris-based IEA.
Through acquisitions, Chinese NOCs' overseas equity oil production had risen to 1.36 million barrels a day in the first quarter of 2010 from 1.1 million barrels a day a year earlier, the IEA said. For comparison, China's domestic production in 2009 was 4 million barrels a day.
The IEA said it found no evidence the Chinese government is imposing a quota on the amount of equity oil NOCs must ship to China.
"Decisions about the marketing of equity oil are based on commercial considerations," it said. "For instance, almost all the equity oil production Chinese NOCs have in Americas was sold locally instead of being shipped back to China."
The conclusion by the IEA shatters the wide perception that the state oil firms are acting under instructions from the Chinese government and eases concerns their expansion could result in reduced and more expensive supplies to other oil-buying nations.
China's national oil companies (NOCs), including China National Petroleum Corp and Sinopec, have emerged as significant players in global mergers and acquisitions from Africa to Americas in recent years.
"Notwithstanding the tendency of the NOCs, in domestic communications, to cast their overseas activities in terms of support for national energy security objectives, their actions appear mainly to be driven by commercial incentives to take advantage of available opportunities in the global marketplace," said the report, released on Thursday by Paris-based IEA.
Through acquisitions, Chinese NOCs' overseas equity oil production had risen to 1.36 million barrels a day in the first quarter of 2010 from 1.1 million barrels a day a year earlier, the IEA said. For comparison, China's domestic production in 2009 was 4 million barrels a day.
The IEA said it found no evidence the Chinese government is imposing a quota on the amount of equity oil NOCs must ship to China.
"Decisions about the marketing of equity oil are based on commercial considerations," it said. "For instance, almost all the equity oil production Chinese NOCs have in Americas was sold locally instead of being shipped back to China."
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