China floors investment in Nigeria's oil and gas sector
By Sulaimon Salau
CHINA, the world's second-largest oil user after the United States (U.S.), in a list of topmost nine countries it considered suitable for investment by the nation's oil companies left out Nigeria, among three other oil producing countries.
According to the list released by China National Development and Reform Commission, countries considered suitable includes Kuwait, Qatar, Oman, Morocco, Libya, Niger, Norway, Ecuador and Bolivia. While Nigeria, Iran and Sudan were not on the list.
The report shows that Chinese companies can get tax holiday or other incentives for investing in oil and gas industries in the listed countries, but the statement gave no details of the kind of incentive to offer to the companies.
It was not clear whether the exclusion of Nigeria, Iran and Sudan came because Chinese companies already have short-term investment plans in the three countries, or for more political reasons or the restiveness in the oil producing regions such as Niger Delta.
China National Petroleum and China Petroleum & Chemical, or Sinopec, are among companies scouring the globe for oil and gas resources to meet surging demand in the world's fastest-growing major economy. The country's oil demand may rise 6.1 per cent to 7.56 million barrels a day this year, according to the International
"The catalog is intended to further encourage and guide domestic companies to invest abroad," the commission said, without explaining its choices.
According to Petroleum and Chemical Industry Association of China, the county's top three oil companies pumped 29 per cent more crude from overseas fields last year. China National Petroleum, Sinopec and China National Offshore Oil produced 35 million metric tons of oil from foreign fields in 2006, accounting for 18 per cent of the total of 200 million tons, it said.
China National Offshore Oil, or Cnooc, completed acquiring a stake in Nigeria's Akpo field in April for $2.7 billion, outbidding rivals, including India's Oil & Natural Gas Corporation.
China already has investments in some of the nine countries on the list but the offer of incentives for further, or new, investments underlines Beijing's determination to acquire further energy assets overseas.
China draws 80-90 per cent of its own primary energy needs from domestic supplies, mainly through coal resources.
