The admission of foreign companies for exploration and production of crude oil in China will allow Russia to strengthen energy friendship with Beijing, I told FBA “economy today” leading expert of National Energy Security Fund, Lecturer Financial University under the Government of Russia Stanislav Mitrahovich.
China intends to allow foreign companies to explore for and produce oil and gas in the country. Ministry of Natural Resources of the PRC announced dates of entry into force of these innovations - to start co-operation, foreign companies may have with 1 May 2020 of the year. However, this will affect only registered in China, foreign companies with net assets of not less than 43 million dollars.
Previously, to conduct exploration and production of oil and gas in China, foreign companies could only in cooperation with Chinese enterprises, not independently. Permissions on mining power China will be issued for five years, renewable for the same period.
"China is a country, which produces a sufficiently large volumes of oil, despite, that does not participate in OPEC +. This country thanks to the majesty of the economy has become the largest importer in the world. Therefore, it is logical, China does not intend to rest on our laurels and seeks to increase the momentum ", - I explained Mitrakhovich.
Permission to search for and produce gas in its territory of China to attract investment to partially reduce dependence on imports.
China's thirst for oil
China is not able to meet its oil needs from own sources, therefore, to support economic development in recent years, the Chinese are engaged in oil production projects and natural gas to more than 40 countries. Chinese companies are interested in gaining access to advanced technologies to improve the efficiency of production and increasing profits on its own and foreign mining companies.
"In any case, China because of the huge country's economy will continue to feel the need to import. Now China is developing rapidly, increasing the production of goods, increasing population, Citizens are beginning to actively use the various benefits of civilization, requiring more energy ", - assured Stanislav Mitrakhovich.
The total amount of allowed import quotas 2019 year in China will be 151 million tons, which is equivalent to 3,02 million barrels per day. In the past four years, Chinese refiners continue to affect domestic oil demand in China, which contributes to the preservation of stability in world prices of this energy.
Russia turns to the East
China every year becomes more and more on import of oil, I - for natural gas. Its growing demand for oil and gas in China is satisfied primarily through the resources of the Persian Gulf. Then there is Africa, Russia and the countries of Central Asia.
"The Russian Federation clearly pay attention to the Chinese permission to foreign companies to conduct exploration and production of oil and gas in the country. Russian energy resources will be needed in China, despite, that some companies can provide additional volumes of the republic ", - I suggested the expert.
Russian oil, Stanislav sure Mitrakhovich, It is very beneficial to China, since its transit extends straight pipe, and this suggests a fairly low cost.
"Now China's relatively dependent on oil from the Middle East, where now there is a military-political tensions. Americans can interrupt the transmission of the resource in case of escalation of military tension on the line of China-US. A straight pipe of Russia will prevent the transit risks in the future - it is a very reliable ", - says expert.
Direct deliveries to China will be safer offshore, Stanislav assumes Mitrakhovich. So far, the Russian side has been supplying oil to China via the shipment on a new export terminal in Kozmino on the shore of the Sea of Japan, where oil is delivered from Skovorodino railway. Specially built retraction length 64 kilometers and a capacity of up to 15 million tonnes per year. Pipeline shipments to China began in 2011 year, and 2017 year capacity of removal increased to 30 million tonnes per year.
Together with demand rising opportunities
In recent years, China has also been an increase in demand for gas. Recall, in December 2019 year, Russia began supplying gas to China through the pipeline "Power of Siberia". This line must bring the Russian-Chinese strategic cooperation in the energy sector to a new level, closer to the bilateral trade in 2024 godu to 200 billion. Already considered the question of the construction of the "Power of Siberia-2", which route can go through Mongolia.
"Now the gas is supplied to China thanks to Arctic projects, as "Yamal LNG". Volumes of supplies less than in Europe, but in China they do on safe ways. Demand is growing at an annual gas in the republic 10% - for the Chinese economy is a good value ", - I explained Mitrakhovich.
Investment investment
According to the expert, the emergence of another opportunity to produce and sell gas and oil, It will be another advantage for Russia in the world market of energy resources.
"If there are mutual investment and exchange of assets between the Russian and Chinese companies, it brought together by hand, and make it easier to work in the territory to China for organizations of Russia ", - suggested Mitrakhovich.
The Russian Federation is currently denied the right to extract and sell resources in China. But the cost of the Russian resources for investment will turn to Moscow's admission to the sale of certain volumes of gas directly to consumers China after the price of legalization.
"China is buying assets in Russia, he became an investor Arctic projects "Novatek", I bought a stake in the company "Sibur". May be, will exchange a large investment between the two countries. This will strengthen the basis for relations. The more commercial interests, the strategically reliable partner ", - summed up the expert.
Alexander Melnik
