China s International Oil and Gas Strategies Philip Andrews-Speed

Transcription

1 China s International Oil and Gas Strategies Philip Andrews-Speed Philip Andrews-Speed and Roland Dannreuther, China, Oil and Global Politics, London: Routledge, May

2 Quad BTU Energy production and consumption, Consumption Production

3 Structure of primary energy consumption Coal 72.2 % 75.8 % 76.2 % 74.6 % 66.1 % 61.4% 69.5% 70.5% Oil 20.7 % 17.1 % 16.6 % 17.5 % 23.2 % 28.6% 21.0% 17.5% Natural gas Hydroelectricity Nuclear & renewable 3.1 % 2.2 % 2.1 % 1.8 % 2.2 % 2.7% 2.7% 4.5% 4.0 % 4.9 % 5.1 % 6.1 % 6.6 % 6.8% 5.8% 6.0% 1.5%

4 million tonnes China: oil supply and demand Oil consumption Refinery throughput Crude oil production

5 bcm Gas supply and demand, Consumption Production

6 Mtoe China s end use for oil (new polices) Other Buildings Transport Industry Power Source: IEA, World Energy Outlook, 2012

7 Elements of China s oil & gas strategies Domestic Overseas Maximise production Diversify imports Maximise refining Maximise crude imports cf product imports Build pipelines Long-term contracts/relationships Ports/terminals/shipping Overland import (pipe/rail) Build storage Overseas investment Coal to liquids, biofuels Exploration & production Fuel consumption standards Refining Gas/electric vehicles Oilfield services & construction Urban mass transport Inward investment from foreign BUT NOCs Encouraging private road Loans for oil, debt relief transport, air travel Diplomacy, aid Fuel pricing/tax

8 thousands of barrels per day Oil trade Crude oil import Oil product import crude oil export oil product export

9 Sources of China s crude oil imports,

10 Mtoe China s future oil demand Current policies New policies 450 scenario Production Source: IEA, World Energy Outlook, 2012

11 bcm China s gas imports, Pipeline LNG

12 BCM Sources of gas imports SE Asia/Aust Africa Middle East CIS Americas

13 Projections of future gas imports bcm/year LNG imports Pipeline imports Source: FACTS Global Energy, 2011, A New Era for Natural Gas in China

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15 Overseas investments: : : Latin America: Small assets, low risk CNOOC : $ 3 bn, for Bridas (failed) Peru, Canada, Thailand, PNG Sinochem ($ 3 bn) & Sinopec in Brazil : larger onshore projects PetroChina: Venezuela Kazakhstan, Sudan, Iran, Venezuela, North America: Nigeria PetroChina: multiple $bn deals In : Canada Wider scope Sinopec $ 4.6 bn, tar sands Canada new types: deep water, tar sands, gas, CNOOC: Trinidad, US Gulf of Mexico, LNG, import pipelines US shale gas and oil, Nexen Active M & A UK: PetroChina-Ineos, CNOOC-Nexen, Sinopec-Talisman Iraq, Iran, Turkmenistan Collaboration with Japan, Taiwan Australia: gas fields, coal-bed methane Loans for oil : Ru, Kz, Br, Vz 2011 overseas oil production : CNPC 42 mmt, Sinopec 18 mmt, CNOOC 4 mmt Total 64 million tonnes, cf total domestic production of 204 mmt 15

16 Destinations of upstream investments by Chinese NOCs C.I.S. + Europe Middle East & Sub-Saharan S, SE & NE Asia, North Africa Africa Australia Azerbaijan Kazakhstan Kyrgyzstan Russia Turkmenistan Uzbekistan United Kingdom Algeria Chad Egypt Iraq, Iran Libya,Mali Mauritania Morocco Niger Oman, Qatar Saudi Arabia Somalia Syria, Tunisia U.A.E. Yemen Angola Cameroon Congo Brazzaville Cote d Ivoire Equatorial Guinea Egypt Ethiopia Gabon, Kenya Madagascar Mozambique Nigeria Sao Taome Sudan Tanzania Australia East Timor Indonesia Mongolia Myanmar Pakistan Papua New Guinea Philippines Thailand Americas Argentina Bolivia Brazil Canada Colombia Costa Rica Cuba Ecuador Peru Trinidad & Tobago U.S.A. Venezuela

17 Chinese NOC s overseas investment: Objectives of the parties China s government Energy Policy: security of supply Industrial policy: pillar industries Social policy: employment Financial policy: forex and tax Foreign policy China s NOC Reserves growth Profits Vertical integration Survival & international ambitions Avoid tight governance & price controls Technology & skills Host government Energy policy: investment (?embargoed) Industrial policy: diversify investors Oil exports: market guarantees Economic policy: investment/aid Resource policy: regaining control Foreign policy: anti-west/usa Host NOC Funds: investment, loans Cheap(er) oil field services Access to opportunities in China For how long will objectives converge?

18 Implications for the global oil & gas industry? Implications for: Global oil and gas supply? Large international oil companies? Smaller international oil companies? NOCs from other oil importing countries? NOCs from oil exporting countries? Regional security in the Gulf and South-east Asia? Relations with states in Africa, CIS, Latin America? 18