World Energy Outlook 2007

For example, the current value of Chinese investment in African oil is
equivalent to 8% of IOC investment, and 3% of all commercial investment
(Downs, 2007).
Table 10.3: Chinese Oil Companies’ Foreign Equity Oil Production, 2004
Country/company b/d Share (%)
Sudan 134 752 36
Kazakhstan 110 452 30
Indonesia 46 941 13
Other 80 225 21
Total 372 370 100
Of which CNPC (including PetroChina) 329 810 89
CNOOC 29 941 8
Sinochem 8 603 2
Sinopec 4 016 1
Source: Downs (2006).
Whatever the underlying reasons for the going-out policy and its implications
for energy security, Chinese companies certainly benefit from it in competing
with other companies to acquire overseas assets. The Chinese state, by far the
dominant stakeholder in these companies, sets the financial targets which are
significantly less onerous than those of the international oil companies.
Moreover, the Chinese companies benefit from privileged terms on loans from
Chinese state banks. The Chinese government also helps the national
companies to acquire assets overseas through active diplomacy and
development aid to resource-rich countries. However, it is not clear that such
assistance is a major factor in enhancing the competitiveness of China’s NOCs
compared to IOCs and other NOCs.
Natural Gas Supply
Gas Resources and Reserves
China’s proven reserves of natural gas amounted to 3 720 bcm at the end of
2006, equal to 2% of world gas reserves (Cedigaz, 2007). On the basis of IHS
data, we estimate that recoverable, proven and probable reserves from
identified fields are approximately 30% higher, at around 5 000 bcm. We
estimate that 80% of proven and probable reserves are non-associated gas, of
328 World Energy Outlook 2007 - CHINA’S ENERGY PROSPECTS