China eyes Mideast's energy resources
Doha, Qatar (UPI) Feb 10, 2011 Qatar is negotiating with China to supply the state-owned energy giant Sinopec with millions of metric tons of natural gas a year to feed the Middle Kingdom's voracious energy appetite. Turkish Foreign Minister Ahmet Davutoglu, architect of the drive by Ankara's Islamist government to transform Turkey into a paramount regional power, was in China in November to promote "the new cooperation paradigm." He signed an accord to transform the ancient Silk Road into a "Silk Railway" linking the two countries. At about that time, a top adviser to Chinese Premier Wen Jiabao visited Syria to sign a cluster of agreements in Damascus as part of President Bashar al-Assad's "look east" policy that intersects with Beijing's westward thrust. China has invested heavily in Syria's antiquated energy sector. These are just some examples of how Beijing, already deeply entrenched in Africa to snap up its natural resources and raw materials, is turning its attention to the Middle East's energy wealth. The ongoing political upheaval sweeping the Arab world, with the toppling of Tunisian tyrant Zine el-Abidine Ben Ali and the looming downfall of Egyptian President Hosni Mubarak, has jolted Beijing. "Ultimately what is most concerning for China about the Egyptian situation is the danger that popular protests could have political ramifications that would increase instability in the Middle East," global security consultancy Stratfor reported. "China, like many other major economies, imports the bulk of its oil from the Middle East and views instability in the region with anxiety." But the Chinese have found, as they did in Africa, that having no ideological or political baggage gives it a big advantage over the Americans, who tie investment to observance of human rights and democratic reform. "China's looking at this region from a very different perspective than the U.S., the British and the French," said Yiyi Chen, a Shanghai University professor who advises Beijing on Middle East Affairs during a recent visit to the Middle East to study the region. "We don't have a view that we want to impose on the countries of the region." There are geostrategic implications here. The Washington Institute for Near East Policy noted in a recent analysis that "the rapid rate of Chinese progress occurs amid a growing regional perception that the United States is withdrawing from the Middle East." Until the Americans can halt this trend and current events may spur such efforts, "China will continue to expand its footprint, sowing the seeds of a new and even less advantageous strategic role in the Middle East for the United States," the institute said. Despite the regional turbulence, there's no sign Beijing is slowing its push into the Middle East as China's demand for energy keeps rising. Indeed, as Washington struggles to adjust as its regional allies, like Egypt and Tunisia, face unprecedented political change that could further diminish U.S. influence, China could find that a whole gamut of new possibilities open up there. Already Saudi Arabia sells more oil to China and the Far East than it does to the United States. Beijing buys 1-10th of the Persian Gulf's output and one-quarter of Iran's. More than 100 Chinese companies operate in the Islamic Republic and the semiofficial Fars News Agency reports that China has signed contracts worth $120 billion with Iran's hydrocarbon sector. China is the leading investor in Iraq's vast oil and gas sectors as Baghdad strives to massively expand its energy infrastructure and production. China is expected to increase its natural gas consumption from 8 billion cubic feet a day in 2009 to 43 billion by 2030. It's expanding its already vast energy infrastructure with pipelines from Central and Southeast Asia and multibillion-dollar liquefied natural gas terminals along its coastline. The tiny Persian Gulf emirate of Qatar, a major gas producer, has already signed deals with Sinopec's rivals, the PetroChina Co. and the China National Offshore Oil Corp., to supply 12 million metric tons of LNG a year. CNOOC, China's third largest energy producer, started importing 2 million tons of Qatari LNG two years ago. The Wall Street Journal says PetroChina has contracted for 3 million tons of Qatari LNG annually for new terminals expected to become operational this year. PetroChina and CNOOC signed preliminary agreements with state-owned Qatargas in November 2009 for an additional 7 million tons of LNG a year.
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