CNOOC's 49% oil profit deal with Somalia [FT]

[General Duke]

CNOOC's 49% oil profit deal with Somalia

By Barney Jopson in Nairobi

 

Published: July 19 2007 03:00 | Last updated: July 19 2007 03:00

 

CNOOC's oil contract with the Somali government grants the Chinese state giant the right to almost half of any profits from production but also promises large bonuses if significant discoveries are made.

 

A production-sharing contract signed last year gives CNOOC and its partner, China International Oil and Gas, the right to 49 per cent of profits from any oil they discover, the Financial Times has learnt from one person who has seen the document.

 

 

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The remaining profit will go to Somalia's transitional federal government (TFG), which will also receive $50m production bonuses for any wells that yield more than 200,000 barrels a day for 75 consecutive days.

 

Somalia remains a speculative region for oil exploration. Several western oil companies held exploration concessions in the country in the 1980s but it has no proved oil reserves and only 200bn cubic feet of proved natural gas reserves, according to the US Energy Information Administration.

 

CNOOC is braving insecurity and political uncertainty as an insurgency against the interim government continues in Mogadishu, the capital. Somalia's own prime minister this week raised questions about the validity of the deal. But due to China's thirst for oil, the group has developed a reputation for launching high-risk ventures.

 

The agreement gives CNOOC and CIOG the right to search for oil in part of semi-autonomous Puntland province and exploration work is due to begin this year.

 

If oil is discovered, the final breakdown of profits will depend on other factors such as income tax and the payment of exploration and production costs. It is not clear whether the twoChinese groups paid an upfront sum to seal the deal when it was signed on May 24 last year.

 

According to the person who has seen the contract, its signatories were Chen Zhuobiao, managing director of CNOOC Africa; Judah Jay, managing director of CIOG; and two junior Somali ministers who had been granted power of attorney by Abdullahi Yusuf Ahmed, the country's president.

 

The contract was endorsed when Mr Yusuf, who is from Puntland, met Fu Chengyu, CNOOC chairman, at the Chinese group's headquarters last November. At the time the TFG had little authority outside its home base in the town of Baidoa.

 

Revelations about the oil deal in the FT have illuminated divisions within the fragile interim government, whose support and authority across Somalia remainslimited.

 

Ali Mohamed Gedi, the Somali prime minister, said this week he was not aware of the deal and that no valid oil deals could be struck until the country's parliament had endorsed a new oil law due to be published in the next two months.

 

But a document signed last month in Nairobi by the Somali energy minister and the two Chinese groups says: "The TFG has and will continue to authorise CNOOC and CIOG to exercise their contract without any interruption during and after the effectiveness of the new national oil law."

 

Copyright The Financial Times Limited 2007

[General Duke]

The new face of Nigeria’s oil industry

Godwin Nnanna

 

November 15, 2006

China has emerged as a major investor in Africa’s oil-rich Niger Delta. Godwin Nnanna hopes that the west's past mistakes will not be repeated."Half a century of oil exploration in the Niger Delta has left the people of the region poorer than they were before the discovery of oil in their neighborhood."

 

For all those desirous to see greater flow of foreign direct investments into Africa, the year 2006 opened on a very optimistic note. China National Offshore Oil Corporation (CNOOC) announced an investment of US$2.3 billion in Nigeria, the continent’s most populous nation. The deal, China’s biggest investment foray into Africa, gives the corporation a 45% stake in an off-shore oil field. China now has partial control over a Nigerian oil field that has the capacity to produce as much as 180,000 barrels per day.

 

China’s investment in that African country is just one out of many of such moves into the continent in last few years, one driven – among other things – by the increasing conflicts and uncertainties in Iraq and other parts of the middle east. Angola, another of Africa’s major oil producers, has now overtaken Saudi Arabia as China’s biggest single provider of oil.

 

Zambia, South Africa, Gabon, Cameroun and the Democratic Republic of Congo are some other African countries that have witnessed surging Chinese economic interest. From South Africa, China seeks iron ore and platinum. From DR Congoand Zambia, it seeks copper and cobalt; and from Cameroun and Congo Brazzaville, it seeks timber. All of these are raw materials that China needs to drive its ever growing industrial sector. And the results are already beginning to show. From a US$3 billion mark in 1995, trade between China and Africa last year stood at US$32 billion. Projections are that the figures will hit US$50 billion by the end of this year and will triple by 2015, the UN’s target year to halve poverty worldwide.

 

The “new scramble for Africa”, as some have christened China’s romance with the continent, has been more dramatic in some countries than others. Despite its lingering political crisis, which has attracted international attention and calls for sanctions, Sudan’s exports to China have soared from 10% in 1995 to 70% of its total exports as of 2005. Beijing also said earlier this year that it will plough US$35 million into the construction of west Africa’s biggest theatre in Senegal, its first major foray into the continent’s entertainment industry.

 

But China’s growing interest in Africa, which has attracted criticisms from other global players such as the US, has been most profound in the continent’s oil-producing states. China has promised to commit US$4 billion to building refineries and power plants in Nigeria. Similar largesse is in the offing for Angola, where China has also promised to raise another US$4 billion to help the reconstruction of roads and other infrastructure.

 

Does the “new scramble” share any resemblance with that of the 17th and 18th century, which saw the massive shipment of African youths to Europe and America? I don’t think so. Western imperialism had no “business” colouration at all. It was simply a rape predicated on ignorance for which some Africans still seek reparation. But today’s oil deals are business: legitimate business consciously entered into by the parties involved, and from which all parties can benefit. For Nigeria, the principal challenge is how to ensure that a greater majority of its 130 million population benefits from the huge inflow of petrodollars.

 

[General Duke]

Sidee CNOOC iyo DFKMG ah u qaybsaden faa'ida shidalka?

20 Jul 20, 2007 - 6:32:48 PM

 

 

Waxaa soo baxaya tafaasiil la xiriirta qaabka ay u qaybsaden faa'idada waxsoo-saarka shidalka shirkada laga leeyahay China (CNOOC) iyo DFKMG ah oo la qorsheynayo in sanadkaan dabayaqadiisa baaris saaliida cayriin ka bilowdo qaybo ka mid ah Puntland.

 

DFKMG ah ayaa heleysa qismi balaaran hadii shirkada CNOOC ay shidaal ka hesho qaybaha la filayo in shidaalkaas laga qodo, inkastoo CNOOC ay qaadatey ku dhowaad bar faa'idada la filayo in laga helo wax-soo saarka shidaalka.

 

Qaybsiga faa'idada wax-soo saarka ayaa heshiis la sixiixey May 2006 ayaa DFKMG ah wax ay heleysaa $50m oo u dhiganta 36m ilaa 25m oo bound taas oo laga helayo ceel kasta oo la qodo isla markana laga soo saaro 200,000 oo fuusto malintii, 75 maalmood oo isku xigtaa. Wargeyska Financial Times UK,London ayaa ka ogaadey qof arkey hehsiiska la kala sixiidey.

 

 

Fu Chengyu, oo ah madaxa CNOOC

Heshiiskan ayaa CNOOC iyo CIOG siinaya xuquuda baarista qaybo ka mid ah maamul goboledka Puntland kaas oo la filayo in uu bilowdo sanadkan gudihiisa.

 

Hadii la helo shidaalka, ayaa qaybsiga faa'idada waxaa ay ku xiraan doontaa inta ay noqdaan canshuuraha iyo kharashka ku baxa wax-soo-saarka. Ma cada in labada shirkadood oo chines-ka ah ay baxsheen lacago horumarin ah markii heshiiskan la saxiixayey.

 

Xogta ay FT ka soo xigatey qofka arkey heshiiskan aya shegeysa in ay ku sixiixnayen Chen Zhuobiao oo ah madaxa CNOOC ee Afrika; Judah Jay oo ah madaxa CIOG iyo labo sarkaal oo wakaalad ka haystey Madaxweyne Cabdulahi Yusuf Ahmad.

 

Heshiiskan aya Madaxweyne C/lahi Yusuf ansaxiyay mar uu la kulmey Fu Chengyu, oo ah madaxa CNOOC China bishii November, kulankaan ayaa dhacey Asbuucyo ka hor inta aysan ciidamada Ethiopia weerarin magalada Muqdisho, xiligaas oo DFKMG ah ay awoodeedu koobneyd.

 

 

Madaxweyne Cabdulahi Yusuf iyo Geedi

Kashifaada heshiiskaan oo ay sameysay FT,UK ayaa waxaa ay kala qaybsanan ku sameysay xiriirka madaxada DFKMG ah oo ahaa mid jlicsan.

 

Ra'isal Wasaraha DFKMG ah ayaa Financial Times u shegey in uusan waxba ka ogeyn heshiiskan isla markaana heshiisna uusan dhaqan gal aheyn inta Barlamanka Somalia ansaxinayo sharciga baarista shidaalka.

 

Lakiin qoraal ay kala sixiideen wasiirka DFKMG ah u qabilsan shidaalka iyo madaxada shirkadaha Chineska ayaa sheegaya in TFG hirgalineyso ansaxida heshiiskan isla markaana u fasaxeyso in howlahooda ay bilowdaan CNOOC iyo CIOG iyada oo aysan ku imaan doonin wax hakad ah.