Walldog & Midtieroil,
You are both mistaken.
1) - Sinopec now effectively controls all 4 blocks of the JDZ (if rumours about its takeover of the Anadarko stake in Blk 3 are to be believed). Add in ERHE’s carry stakes and it essentially own those blocks. So if and when oil and/or gas is found in sufficient quantities;
….. the mercantilist Chinese are going to develop their own infrastructure on the JDZ and (if they can manage an acquisition or two) on the EEZ as well. Probably loop them together in time. One huge consortium (to use old Richkan’s terminology) composed of Sinopec, itself and its namesake…
And then pump the stuff from their platforms directly on to Chinese tankers.
Don’t matter if AKPO or BOLIA are right next door. Sinopec is not going to share anything with western firms, pay for transit on their seabed grids and see “its” oil end up in some Nigerian refinery/storage tanks. It’s crude from the sea direct on to Chinese VLCCs shipped directly home. And China is building a lot of VLCCs (to the consternation of the Greeks) ….. Besides, Sinopec (and its two other siblings) have plenty of increasingly funny money to play with, and they have a domestic industry and a humongous labour pool to respond to whatever is needed by any deepsea build and roll out. (Anything special or too elaborate…. will just be bought from the Koreans).
2) - So very simply, property, infrastructure, transport and capital, all in Chinese hands. The full mercantilist circle. And this obviously is not just for oil produce, but for all the gas extracted as well, associated or stand alone (which some think may be the case in the EEZ). And it is here where the case for building direct gas-to-liquid floating platforms (as opposed to sharing capacity on neighbouring existing networks) arises and is a very real possibility – by reason of the mercantilist logic driving the Chinese - as presented above. Oil or gas/LNG. Both are equally craved by China.
Which is why Beijing is in a huge brawl with Japan over rights to the gas fields in the Sea of Japan. And why it has (just last week) approved joint exploration for natural gas with its arch enemy – Taiwan – in the Straits of Taiwan……And why even Sinopec itself, has an exclusive technical co-operation agreement now in place with Syntroleum, America’s floating gas to liquids (including LNG) pioneer.
3) - Personally I don't give a rat's ass of how Sinopec or anyone else chooses to develop production facilities in either the JDZ (or the EEZ). I don’t plan to be around till then, neither does most everybody else on this board.
But being aware that natural gas finds are no longer the throw away items they once were considered to be in acreage so far from land, is important to understand. It is not that such finds have primacy in our collective discovery expectations. They do not. But they have – increasingly so - intrinsic worth and as such impact the value of share price. Especially if the drillings now before us in the JDZ (and perhaps more so in the EEZ in about 18/24 months time) yield more gas than oil.
spp119
AI
