Chinese oil companies sign significant production and import deals in Ecuador, Iraq, and Sudan
China has made plans to increase its global sourcing of oil in a series of major deals with Iraq, Ecuador, and Sudan.
China National Petroleum Company (CNPC) has begun operations at Iraq's Al-Ahdab oil field – the country's biggest development in the last 20 years. The field is expected to yield three million tons of crude per year and represents a $3bn investment from the Chinese giant. However, CNPC are only receiving a fee per barrel, rather than having direct equity in the field, meaning that they will make less than 1% profit. Despite this, one Chinese oil executive claimed it was a good way to “get a foot in the door” of Iraqi oil, which is estimated national reserves of more than 100 billion barrels.
Meanwhile, PetroEcuador has agreed to sell 130 million barrels of crude and 18 million barrels of fuel oil to PetroChina over the next six years. PetroEcuador CEO Marco Calvopina said that they will begin selling in August.
After a visit from Sudan's President Omar-al-Bashir, Premier Hu Jintao has agreed to increase its investment in Sudanese oil, which currently makes up 5% of China's crude imports and is the country’s sixth largest source of overseas oil. Both party officials in Beijing and intellectuals both advocate a non-violent conflict resolution in the Sudan to ensure a stable future for Chinese energy imports.