The fact that China has paid top dollar for projects rejected by Western oil companies has left some analysts shaking their heads about what they see as Beijing's willingness to shell out too much for too little.
Harbert, the U.S. Energy undersecretary, said China's large state-owned energy firms had a "different risk profile" than U.S. companies that must answer to shareholders.
"Just by that difference in purpose, [Chinese firms] have the ability to go into areas where private-sector companies cannot bear that risk," she said.
Some of China's more far-flung deals, such as in Venezuela, reflect a "politically driven panic" to secure any source of crude oil without much regard to practical issues such as transportation and refinery capabilities, said Mikkal Herberg, an oil expert at the National Bureau for Asian Research in Seattle.
"The Chinese are in the mode to pay for supply security ... and the economics come secondarily," he said.
Others say Chinese oil companies are ill-prepared for the future, lacking the technology to compete for deep-water drilling projects, which will make up the bulk of future oil exploration. A Unocal takeover could expand their expertise, however.
Ma Xiaoye, a former Chinese trade official and now head of the Academy for World Watch, an independent civic group based in Shanghai, said the country must better coordinate its efforts.
"I can't see in the foreseeable future that China will act like the U.S. with military, political, diplomacy tied to oil security," he said. "China is not that sophisticated. We are not that prepared."
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Seeking oil abroad
China's growing demand for oil has led it to look overseas for new supplies. A sample:
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- Canada: Granted access to oil sands in Alberta, considered the richest reserves outside Saudi Arabia; has 17% stake in Calgary firm with proprietary oil sands technology.
- El Segundo: CNOOC Ltd. made an unsolicited $18.5-billion bid for Unocal Corp.
Indian Ocean
- Nigeria: New railways funded by China.
- Gabon: China paying for port project.
- Angola: China's second-largest supplier is among the African nations benefiting financially in return for oil. Projects include electricity for Angolan slums.
- Russia: In talks for a 1,500-mile, $2.5-billion pipeline to supply 700 million tons of Russian crude over 25 years.
- Sudan: Its largest oil investor is China, which holds a 41% stake in a major Sudanese oil consortium.
- Kazakhstan: A $2.5-billion pipeline to western China is due for completion this year; it will be capable of transporting 20 million tons of oil annually.
- Iran: Chinese companies spent $70 billion for a majority stake in the nation's largest onshore oil field. China has also promoted relations by selling weapons to Iran.
- Saudi Arabia: China's largest oil supplier has a consulate in Hong Kong and a Beijing office for its state oil company.
- Rwanda: Road projects funded by China.
- Myanmar: Officials negotiating to build oil and natural gas pipelines from northern Myanmar to southwestern China.
- Strait of Malacca: The pirate-infested bottleneck off Malaysia through which more than 60% of China's oil imports flow.
- Spratly Islands: China called this month for joint exploration in the disputed islands near the Philippines.
- Philippines: State oil companies reached a deal in 2004 to research oil in the South China Sea.
- Indonesia: Third-largest oil and gas producer is also China's largest offshore oil producer. Will provide liquefied natural gas to fill a new terminal in Guangdong province.
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Sources: Times reporting; ESRI; www.nelsonresources.com
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Contributing to this report were Times staff writers Evelyn Iritani in Calgary, Robyn Dixon in Luanda, Tyler Marshall in Washington, Carol J. Williams in Caracas, Don Lee in Shanghai and Megan K. Stack and Hossam Hamalawy in Egypt. Also contributing were special correspondents Thomas Erdbrink in Iran, Alexei V. Kuznetsov in Russia and Tsai Ting-I in Taiwan.
