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Wednesday, October 7, 2009

China angling for absolutely huge amount of African oil

The Chinese state-owned oil company CNOOC is in talks to buy huge stakes in several of Nigeria's biggest oil deposits. The areas are already partly or wholly controlled and operated by Western oil companies, but many are coming up for licensing renewal - and China is hoping to grab a piece of the action.

In all, the company is trying to buy 6 billion barrels of proven reserves, over 1/6 of Nigeria's total supply of crude oil, for an estimated $30 to $50 billion.

A letter to the company from Nigeria's president said the inital offer was "unacceptable," but that a more "favourable" revised offer would be considered.

The details of the potential deal are a little unclear, but you can bet Western oil companies will be on the losing end.

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