APPENDIX Chart 1: History of China's Petroleum Industry 1950: The General Bureau of Petroleum Administration was established, subordinate to the Fuel Industry Ministry (FIM) and in charge of construction and production for China's petroleum industry July 1955: The Petroleum Industry Ministry (PIM) was established. June 1970: The three ministries of the petroleum, coal and chemical industries were incorporated into Fuel and Chemical Industry Ministry (FCIM). February 1975: The Fuel and Chemical Industry Ministry (FCIM) was dissolved and Petroleum and Chemical Industry Ministry (PCIM) was established. March 1978: The Petroleum and Chemical Industry Ministry (PCIM) was dissolved, and the Petroleum Industry Ministry (PIM) was restored September 1988: China National Petroleum Corporation (CNPC) was established on the basis of the former Petroleum Industry Ministry. The newly founded CNPC served as the State oil company, focusing on upstream operations while also assuming some governmental functions and responsibilities. February 1982: China National Offshore Oil Corporation July 1983: China Petrochemical Corporation (Sinopec) July 1998: In accordance with reforms approved by the First Session of the Ninth National People's Congress, CNPC and Sinopec were restructured into integrated oil companies. Source: According to CNPC, The History of CNPC, with changes. See: http://www.cnpc.com.cn/english/gsgk/lsyds_cnpcls.htm and http://www.cnpc.com.cn/gsgk/lsyds.htm#07. Table Selected Investment by Chinese Oil Companies in Overseas Oil Exploration and Production Coutry Algeria Date Company 2002 Sinopec Project 75% stake in the Zarzatine field Value (US$ million) 394 313 assets acquisition agreement on Australian Northwest Continental Shelf Natural Gas Project. 348 CNPC 30% stake in the Kursangi and Karabagli oil fields from the European Bank for reconstruction and development 52 1991 CNPC UN-sponsored oil sands development Canada 1993 CNPC Equity stake in North Twining oil field in Alberta, Saskatchewan, Canada. This field produced the first barrel of overseas crude in China's history. Ecuador 2003 CNPC CNPC Amazonia purchased rights to Block 11 from Lumbaqui Oil, subsidiary of Romania's Rompetrol. Indonesia 1993 CNOOC 32.58% stake in a block in the Straits of Malacca from ARCO. Indonesia 1995 CNOOC Additional 6.93% stake in a in a block in the Straits of Malacca Indonesia 2002 CNOOC Ltd. Assets of Repsol-YPF 585 Indonesia 2002 CNOOC purchased an equivalent 12.5% stake of Tangguh Liquefied Natural Gas Project in total from BP. 275 Indonesia 2002 PetroChina Assets of Devon Energy 262 82 13 Australia 2003 CNOOC Azerbajan 2002 Canada Indonesia 2003 PetroChina Half the assets of Amerada Hess Indonesia Holdings Co. Amerada Hess has a 30% stake in the Jabun Block on Sumatra, which has proven reserves of 267 million barrels of oil equivalent in six oil and gas fields. Iran 2001 Sinopec Production sharing contract with National Iranian Oil Company for a joint exploration and develoment of an oil and gas block in the Zavareh-Kanshan region. Sinopec is the operator. Iraq 1997 CNPC Production sharing contract to develop al-Ahdab field 1200 Kazakhstan 1997 CNPC 60.2% stake in Aktyubinsk Oil Co. 4300 Kazakhstan 1997 CNPC Contract to develop Uzen oil field 1300 Kazakhstan 2003 CNPC Additional 25.12% stake in Aktyubinsk Oil Co. Kazakhstan 2003 CNPC purchased 35% stake in the North Buzachi oil field from Nimr Petroleum (Saudi Arabia) Myanmar 2001 CNPC Agreement for enhanced oil recovery work at the Pyay (Prome) oil field. CNPC will receive 40% of the output. Nigeria 1997 CNPC Agreement for exploration of the Chad Basin with the Nigerian National Petroleum Corporation Nigeria 1998 CNPC Two exploration blocks in the Niger River delta Papua New Guinea 1994 1995 CNPC Two exploration blocks offshore of Gulf Province in 1994 (Block 160) and 1995 (Block Kamusi) Peru 1993 CNPC Operation rights for enhanced oil recovery in the Talara oil field 150.16 25 314 Sudan 1995 CNPC Production sharing contract for Block in the Muglad Basin Sudan 1997 CNPC Production sharing contract for Blocks 1/2/4 in the Muglad Basin Sudan 2000 CNPC 23% stake in Block 3/7 in the Muglad Basin Thailand 1993 CNPC Production sharing contract to develop the Banya block Venezuela 1997 CNPC Intecampo Norte and Caracoles blocks, enhanced oil recovery work Yemen 2001 Sinopec Agreement with the German firm Preussag for risk exploration in S2 block Yemen 2003 Sinopec Memorandum of understanding with the Yemeni Oil Mining Ministry to explore for oil in the Amakeen region of Shabwah Province 10 700 Map Russian Far Eastern Oil Pipelines Source: Adapted from “The oil wars: in the pipeline,” The Economist, May 1–7, 2004. 315 Map Sino-Kazakhstan Oil Pipeline Source: F William Engdahl, “China Lays down Gauntlet in Energy War: the geopolitics of oil, Central Asia and the United States,” Asian Times, 22 December 2005. Chart Roles played by Government & NOC and the Resulted Approach Year Internal Stabilizer 1993 Economic Efficiency Promoter Approach of Oil Pricing Reform State -controlled Approach (SCA) Marketdominated Approach (MDA) NOC's Primary Role State Policy & Social Obligation Undertaker (SPSOU) Market Actor Government's Primary Role before 1993 1994-1998 since 1998 Internal Stabilizer both roles SCA State Policy & Social Obligation Undertaker (SPSOU) Mixed Approach both roles 316 Government's Primary Role Approach in WestEast Gas Pipeline Project Decision Stage Negotiation & Implement Stage Internal Stabilizer Economic Efficiency Promoter SCA MDA SPSOU Market Actor NOC's Primary Role 1997 striving for the pipeline Government's Primary Role Approach in SinoKazakhstan Oil Pipeline Internal Stabilizer 1999 shelving the pipeline Economic Efficiency Promoter Internal Stabilizer SCA MDA Mixed Approach SPSOU Market Actor Market Actor NOC's Primary Role Government's Primary Role Approach in Russian Oil Pipeline 1st stage: Impassive to Russia's proposal Economic Efficiency Promoter 2nd stage: 3rd stage: Japan's involvement since 2002 Internal Stabilizer Internal Stabilizer MDA Mixed Approach SCA Market Actor Market Actor SPSOU NOC's Primary Role Government's Primary Role Approach in Acquisition over Unocal NOC's Primary Role 2003 restart the pipeline Economic Efficiency Promoter MDA Market Actor 317 . State -controlled Approach (SCA) Market- dominated Approach (MDA) SCA Mixed Approach NOC's Primary Role State Policy & Social Obligation Undertaker (SPSOU) Market Actor State. Internal Stabilizer Approach in Sino- Kazakhstan Oil Pipeline SCA MDA Mixed Approach NOC's Primary Role SPSOU Market Actor Market Actor 1st stage: Impassive to Russia's proposal. Stabilizer Approach in Russian Oil Pipeline MDA Mixed Approach SCA NOC's Primary Role Market Actor Market Actor SPSOU Government's Primary Role Economic Efficiency Promoter Approach