Race to the world’s energy hotspots

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Race to the world’s energy hotspots
Terry Macalister
The Guardian
07 Jul 2006

The decision by Sinopec of China to pay $1bn for the right to explore for oil in deep water off Angola has shocked the west, which fears it could be left behind in a global scramble for resources.

Similar oil prospects off the coast of the impoverished African country were selling for $35m (19m) less than a decade ago, when western oil giants such as BP and Shell had the field almost to themselves.

The rising power of oil companies from fast-developing and energyhungry nations such as China and India have contributed to soaring oil prices. This week, they hit record highs of $75 a barrel, dipping only slightly yesterday.

“It’s just like the British housing market. You have a lot of people chasing a few opportunities. The difference with oil is the companies have huge amounts of cash,” said Derek Butter, an analyst at energy consultants Wood Mackenzie, based in Edinburgh.

And it is not just Angola that is benefiting. The Nigerian government has just sold 16 exploration licences in deep water areas for $500m and secured promises that the buyers will spend a further $20bn on new infrastructure projects such as gas-processing units. Licences have been... read more...