Sino-Russian Oil and Gas Cooperation

Transcription

1 Sino-Russian Oil and Gas Cooperation The reality and implications KEUN-WOOK PAIK Published by the Oxford University Press for the Oxford Institute for Energy Studies 2012

2 CONTENTS List of Tables xiii List of Maps and Figures xvi Acronyms and Units of Measure xvii Endnotes xxii Acknowledgements xxiii Preface xxv Introduction _ xxvii Chapter 1: The Energy Factor in Sino-Russian Relations 1 A Brief Review of Sino-Russian Relations 1 The Energy Factor in Sino-Russian Relations 7 A Brief Review of Sino-Russian Energy Cooperation in the 1990s 9 China's Bold Initiative towards East Siberia: 1993 and Oil and Gas Potential in East Siberia and RFE, the early 1990s. 14 Oil and Gas Potential in China in the early 1990s 15 Unfulfilled Initiatives for Pipeline Infrastructure Development in the 1970s, 1980s, and 1990s 16 Chapter 2: The Development of the Oil Industry in Eastern Siberia and the Russian Far East - 20 The Role of Oil and Gas iii the Russian Economy 20 The Resource Curse and Putin's Resource Nationalism 24 Russia's Initiative towards East Siberia and the Far East's Frontier Oil Development 28 East Siberia's Exploration Programmes 30 Rosnedra and geological exploration 33 Eastern exploration programme approved 35 ESPO Pipeline's Main Production Bases 36 The Irkutsk region, 39 The Sakha (Yakutia) Republic 49 Krasnoyarsk Territory.. 52 vn

3 Sakhalin Offshore Oil Development 62 Sakhalin-1 ' j 62 Sakhalin-2 ' 64 Sakhalin-3, 4, 5, and 6 67 Conclusion 69 Appendix to Chapter 2 72 Chapter 3: The Development of the Gas Industry in Eastern Siberia and the Russian Far East 76 -^ The Russian Gas Industry: Divided between West and East 76 Russia's Gas Production: Main vs New Producing Fields 81 Review of Gazprom's Exports to Asia Policy 83 The Eastern Dimension of the UGSS 85 The Eastern (Gas) Programme (EGP) 86 Preliminary work 86 Approval 86 The Gas Industry Development Strategy to The 2030 energy strategy 93 The Gasification Programme in East Siberia and Russia's Far East 95 The Sakhalin-Khabarovsk-Vladivostok (SKV) gas transmission system development and its Implications 99 The Three Main Gas Supply Sources for the Eastern UGSS 101 Kovyktinskoye (or Kovykta) Gas 101 Start-up and preparation work 101 The three party feasibility study 103 The Gazprom factor 104 The Helium question 106 TNK-BP agreed to sell its controlling stake to Gazprom 108 Kovykta ownership switches to Gazprom 111 Sakhalin Offshore Gas 113 Sakhalin Sakhalin Sakhalin Sakhalin-4, 5 and Sakha Republic Gas 128 Conclusion 136 Appendix to Chapter, vin

4 Chapter 4: The Oil Industry,in China 142 China's Energy Balance 142 China's Energy Policy 145 A change of priorities 145 Restructuring the Government's Energy Bureaucracy 150 Oil Industry Restructuring 153 Exploration and Production 155 The Third National Oil and Gas Reserves Survey 156 Onshore 160 Daqing field 160 Tarim as an alternative to Daqing ~" 162 Offshore \ 164 Oil Imports 167 Pipelines 170 Refining 176 Strategic Oil Reserves 180 Conclusion 182 Appendix to Chapter Chapter 5: The Gas Industry in China 189 Domestic Gas Resources 189 China's Main Gas Production Bases 193 Coalbed Methane (CBM) 194 Shale Gas 197 China's Domestic Gas Demand 199 Changes in Consumption Structure 201 Gas Price Reform 205 The 2006 Gas Price Reform 206 The Unrealized 2009 Gas, Price Reform and Gas Price Setting for the Sichuan-to-East Pipeline (SEP) 213 The 2010 Gas Price Increase as the First Step in Price Reform 219 The Price Burden of Gas for Power 220 City Gas (Towngas) Expansion 225 CNPC's Entry to the Towngas Sector ' 229 The Nationwide Gas Pipeline Network Development 231 The West-East Gas Pipeline (WEP I) Project 234 The WEP I construction plan 235 WEP I expansion and the adjustor pipeline IX

5 Collapse of foreign partnership for WEP I 236 WEP II 237 WEP III, IV, and V 241 International Gas Pipelines 243 Feasibility Studies on Two Gas Pipelines 243 WEP and the Russian and Central Asian Gas Pipeline 244 Myanmar Gas Pipeline 245 LNG Expansion 246 Review of the Guangdong and Fujian LNG Developments 246 The Second Wave of LNG Expansion 250 Difficulty in Securing LNG Supply Sources 254 China's Adventurous CBM-LNG Deal 258 Conclusion 260 Appendix 5.1: China's Four Main Gas Production Bases 263 Tarim Basin 263 Ordos Basin 268 Sichuan Basin 270 Offshore Gas 274 Appendix 5.2.: Domestic LNG Facilities 276 Chapter 6: Chinese Oil and Gas Investment in Central Asia 280 China's 'Going-Out' Policy 280 Chinese NOCs' M&A deals: Central Asian Republics' Oil and Gas Supply Options 286 Crude Oil Supply Through the Sino-Kazakh Oil Pipeline 286 The initiative for staged pipeline development: Kenkiyak-Atrau section 288 The Atyasu-Alashankou section development 290 Kenkiyak-Kumkol section agreed 294 Natural Gas Supply Through the Trans-Asia Gas Pipeline 298 Turkmen gas reserves 298 The discovery of the super-giant gas field Yuzhny-Yolotan 300 Turkmenistan 301 Sino-Turkmen gas framework agreement signed 302 China rewarded by Turkmenistan's stance against Russian monopoly 304 The gas price burden and the equity gas solution 305 Uzbekistan 308 Kazakhstan 311 Priority given to the Trans-Asia gas pipeline 312 Conclusion 314

6 Chapter 7: Sino-Russian Oil and Gas Cooperation since 2000 ' f 317 The Oil Sector 317 The Angarsk-Daqing Pipeline 317 Yukos-CNPC feasibility study for the oil pipeline 318 Russian crude supply to north-east China and its implications for the related refinery revamping 320 Transneft's Low Profile but Bold Initiative 322 Japan's Initiative and China's Response 324 The Rise and Collapse of Yukos 326 Moscow Wisely Stays in the Middle 327 Putin Elaborates Russia's Stance^ 329 Russia's Strategy of Delay 330 Green Light for the East Siberia-Pacific Ocean (ESPO) Pipeline 331 ESPO Construction 332 Challenges to the Pipeline Route 334 Transneft's Management Change 335 The Interim Alternative: Oil to China by Rail 336 ESPO's First Stage Operation and the Spur Line Development 337 The ESPO Spur Line to China 339 ESPO First Stage Completed 340 ESPO Crude Challenges the Asian Premium 341 Taxation and SPR Storage 342 Factors Related to ESPO 344 The tariff issue 344 Vostok refinery 347 Loans for Oil 348 The first $6 billion loan to Rosneft 348 The second loan for oil \ 349 The Gas Sector 350 Kovykta Gas Export Initiative 350 Gazprom's Asian UGSS Initiative and the Sakhalin-1 Option 353 Gazprom's 2005 Beijing Interview 354 CNPC's Lukewarm Response 355 Putin's over-advertised trip to China 356 No Breakthrough by The Altai Pipeline Project 358 No Compromise in The Price Lesson XI

7 Sino-Russian M&A Deals and Strategic Partnership: Failures and Successes 367 CNPC's Attempts to Take Over Slavneft and Russia's Brutal Response 367 CNPC's Ill-Fated Attempts to Purchase Stimul 368 Rosneft's Strategic Partnerships with CNPC and SINOPEC 369 Zhang Guobao's Rare Display of China's Frustration 370 SINOPEC's Udmurtneft Breakthrough 371 Vostok Energy: CNPC's Entry to Russia's Upstream Sector 372 Chinese-Russian Eastern Petrochemical Company: Rosneft's Entry to China's Downstream Sector 374 SINOPETRO's Venture with. Yuzhuralneft 375 RusEnergy's Equity Stake in Suntarneftegaz 375 CIC's Equity Stake in Nobel Oil 376 Conclusion 376 Appendix to Chapter Chapter 8: Conclusion 391 Oil 392 Natural Gas 395 Likely Evolution of Oil and Gas Trade up to National, Regional, and Global Consequences 400 National Consequences 400 Regional Consequences 401 Past Problems, Future Questions, Global Consequences 406 Bibliography and other Sources 408 Bibliography 408 Newspapers, Periodicals and Web Sites 439 Notes 442 Index 498 xn