Africa --between Western schadenfreude and Chinese capitalism:
atimes.com
Excerpt:
China energy geopolitics also in high gear
For its part, Beijing is also moving to "secure energy at the sources". China's booming economy, with 10% growth, requires massive natural resources. China became a net importer of oil in 1993. By 2045, China will depend on imported oil for 45% of its energy needs.
On May 26, crude oil began to flow into China through a newly completed pipeline from Atasu, Kazakhstan, to the Alataw Pass in China's far-western region of Xinjiang, a 1,000-kilometer route announced only last year. It marked the first time oil is being pumped directly into China. Kazakhstan is also a member of the SCO, but had been regarded by Washington since the collapse of the Soviet Union as in its sphere of influence, with ChevronTexaco, Rice's former oil company, the major oil developer.
By 2011 the pipeline with extend some 3,000km to Dushanzi, where the Chinese are building their largest oil refinery, due to completed by 2008. China financed the entire $700 million pipeline and will buy the oil. Last year the China National Petroleum Corp bought PetroKazakhstan for $4.2 billion and will use it to develop oilfields in Kazakhstan.
China is also in negotiations with Russia for a pipeline to deliver Siberian oil to northeastern China, a project that could be completed by 2008, and a natural-gas pipeline from Russia to Heilongjiang province in China's northeast. China just passed Japan to rank as world's second-largest oil importer behind the United States.
Beijing and Moscow are also integrating their electricity grids. Late last month the China State Grid Corp announced plans to increase imports of Russian electricity fivefold by 2010.
In its relentless quest to secure future oil supplies "at the source", China has also moved into traditional US, British and French oil domains in Africa. In addition to being the major developer of Sudan's oil pipeline, which ships some 7% of total China oil imports, Beijing has been more than active in West Africa, the source of vast fields of highly prized low-sulfur oil.
Since the creation of the China-Africa Forum in 2000, China has scrapped tariffs on 190 imported goods from 28 of the least developed African countries, and canceled $1.2 billion in debt.
Indicative of the way China is doing an end-run around the Western-controlled International Monetary Fund among African states, China's Export-Import Bank recently gave a $2 billion soft loan to Angola. In return, the Luanda government gave China a stake in oil exploration in shallow waters off the coast. The loan is to be used for infrastructure projects. In contrast, US interest in war-torn Angola has rarely gone beyond the well-fortified oil enclave of Cabinda, which ExxonMobil along with Shell Oil have dominated until recently. That is apparently about to change with the growing Chinese interest.
Chinese infrastructure projects under way in Angola include railways, roads, a fiber-optic network, schools, hospitals, offices and 5,000 units of housing developments. A new airport with direct flights from Luanda to Beijing is also planned.
Indirectly, through its support of the Sudanese government, China is also a contender in a high-stakes game of potential regime change in neighboring, oil-rich Chad. This year, World Bank president Paul Wolfowitz was forced to back down from plans to cut off World Bank aid because of the threat of an oil-export cutoff by Chad. ExxonMobil is currently the major oil company active in Chad. But Sudan backs Chadian rebels, who were only prevented from toppling the notoriously corrupt and unpopular regime of President Idriss Deby by the 1,500 French soldiers propping up the regime. Washington has joined with Paris in backing Deby.
Sudan has involved Chinese, rather than Western, corporations in exploiting its oilfields, largely as a result of misconceived US sanctions imposed in 1997, which blocked US oil companies from doing business in Sudan. A new Sudan-backed regime in Chad would jeopardize the Chad-Cameroon pipeline and Western oil firms. One can imagine China just might be willing to step into such a vacuum and help Chad develop its oil, especially if the lion's share went to China.
Immediately after his humiliating diplomatic visit to Washington in April, President Hu went on to Nigeria, Africa's largest oil producer and long regarded by Washington as in its "oil sphere of interest". In Nigeria, Hu signed a deal whereby the African country will give China four oil-drilling licenses in exchange for a commitment to invest $4 billion in infrastructure.
China will buy a controlling stake in Nigeria's 110,000-barrel-per-day Kaduna oil refinery and build railway and power stations, as well as take a 45% stake in developing Nigeria's OML-130 offshore oil and gas field, referred to by the chairman of China National Overseas Oil Corp as "an oil and gas field of huge interest ... located in one of the world's largest oil and gas basins".
Almost all of Nigeria's current oil production is controlled by Western multinationals. But the situation there will also soon change in China's favor. Similar soft infrastructure loans or energy investment offers are being made to Gabon, Ivory Coast, Liberia and Equatorial Guinea. The curious charge against China of "not playing by the rules" and "trying to secure energy at the source" begins to assume real dimension when these and Russia's recent energy moves are taken as a totality.
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