China Reinforces Oil Investments in Africa
Since CNPC set its first footprint in Sudan in November 1996, the company has made fruitful results in oil/gas investment in the vast Africa, while contributing a lot in the construction of local infrastructure. So far, CNPC has contracted some 20 projects in nine African countries.
In recent years, on the basis of favorable bilateral relationship between China and African countries, CNPC has reinforced oil & gas investment in Africa in a bid to strengthen economic ties with African brother nations and contribute to African countries’ economic development as well.
Venturing oil exploration in Niger
CNPC announced on November 6, just after the end of the Beijing Summit of the Forum of the China-Africa Cooperation, that it had started drilling a wildcat well named Saha-1 at the Tenere block in western Africa’s Niger.
The operation is CNPC’s first step to venture overseas upstream exploration in such an uncultivated area. It is learned that besides the Tenere block, CNPC will also carry out similar operations at the Bilma block in Niger. By now, no oil reserve has been proven in the two blocks. Previous operators had quitted their operation in the region, leaving a dry well there.
But this does not necessarily mean that CNPC’s decision is imprudent. On the contrary, CNPC has an increasing confidence over its effort of going overseas.
An insider of the company familiar with the matter deems that the two blocks have favorable geographic structure and significant recoveries could be made in the next five years.
CNPC also started its E&D projects in Algeria and Mauritania in September. These projects could be part of CNPC’s layout of reinforcing the company’s overseas oil & gas E&D activities.
Starting from 1997, CNPC has contracted several upstream exploration and development agreements with Sudan, Kazakhstan and Venezuela. But these projects are mostly based on mature oilfields, which usually are left by previous arrivals with limited reserves.
Thus, if the company wants better profitability, it has to venture itself to look for new oilfields worldwide. To target future findings, CNPC, which has accumulated ’going-overseas’ experiences and sharpened its technology standards, has shifted its focus from mature oilfields to undeveloped areas.
Energy cooperation with Algerian counterpart
Also in this November, CNPC signed a hydrocarbon cooperation agreement with the Algerian state oil company of Sonatrach. Under the agreement, the two sides will look for development opportunities on the basis of mutual interests.
The agreement was signed by Abdelhafidh Feghouli, the head of Sonatrach’s down-stream business, and CNPC vice president Zhou Jiping, in the presence of Algerian Presi-dent Abdelaziz Bouteflika during his state visit to China.
CNPC’s comments are unavailable, but the company has already expressed its interest in building a 15 million ton/year greenfield refinery at Tiaret in western Algeria.
In May 2005, CNPC won an engineering contract to build Sonatrach’s 5 million ton/year condensate oil refinery in Algeria’s Skikda Province, with a total investment of US$385 million.
- Database Search
- Unpaid Debt A comprehensive overview of the role of the Lundin Consortium in the oil war. ECOS calls upon the Swedish, Austrian and Malaysian governments to investigate whether, as a matter of international law, Lundin, OMV and Petronas 'were complicit in the commission of war crimes and crimes against humanity by others during the period 1997-2003.’ In response, the Swedish Public Prosecutor for International crimes opened a criminal investigation into ‘links between Sweden and the reported crimes’.
- In Depth For more specific information about the Lundin court case please visit the Unpaid Debt dossier.
