China’s massive game of global resource domination looks set to continue well throughout the decade.The Chairman of state-owned PetroChina says the company plans to spend $60 billion on a global expansion over the next 10 years, according to Bloomberg. Right now just a tenth of its production comes from overseas, but it’s goal is to bring that to 50% by 2020.
The timing of the announcement is interesting because it comes just as reports emerge about allegedly underhanded tactics used by CNPC (PetroChina’s corporate parent) in securing international oil rights.
The story that’s brewing right now takes place in Kazakhstan, and is therefore complex and disputed.
A longer, but very worthwhile version of the story comes from investigative reporter Steve LeVine the author of The Oil and the Glory: The Pursuit of Empire and Fortune on the Caspian Sea.
Assuming there’s something to the story, it’s worth asking: is this a China story or a Kazakhstan story? That Chinese SOEs (state owned enterprises) would use all manner of tactics to secure resource rights wouldn’t be particularly shocking. And as PetroChina embarks on its massive expansion plan, this will be a story to watch.
On the other hand, we know that Kazakhstan is a home of resource scandals, and the securing of energy rights there is going to be rich with controversy and politics. Last May we wrote about the controversial manner by which Bill Clinton ally Frank Giustra secured Uranium rights there.
In a post-soviet, resource rich state like such as this one, this is all par for the course.