Author: Tatsuo Kotoyori
Publication: The Asahi Shimbun
Date: February 21, 2008
URL: http://www.asahi.com/english/Herald-asahi/TKY200802210054.html
In October 2007, an oil-drilling derrick was
built in eastern Ecuador near the source of the Amazon river.
"Since then, the well water has smelled
bad. Everyone is complaining about it," said Manuel Bonilla, who grows
bananas in the suburb of Tarapoa in Sucumbios province.
The derrick stands just in front of the house
of the 62-year-old farmer.
It was built by Andes Petroleum Co., a company
jointly set up by two of China's three major state-run oil companies, one
of which is China National Petroleum Corp. (CNPC).
In 2005, the joint company purchased oil-drilling
rights from a Canadian firm that had decided to withdraw from the region.
The oil facilities in the jungle are enclosed
by a high-voltage electrified barbed-wire fence and are protected by guards
armed with guns. There is also a runway for aircraft, making the site look
even more like a U.S. military base in Japan.
Chinese engineers at the facilities rarely
leave, spending most of their money on-site. The engineers are apparently
afraid of becoming the targets of repeated demonstrations held by local people
demanding improved water quality and more jobs.
In November 2006, dozens of Chinese and people
related to the site were caught by local residents.
"They (Chinese) must be living in air-conditioned
rooms inside the oil facilities. They are like kings," Armulfo Estrella,
35, a local senior member of Ecuador's ruling party, said sarcastically.
China, which has become the second-largest
oil-consuming country in the world, has made inroads into nearly 40 countries
to obtain oil. In the process, however, it has caused friction with local
residents within those countries.
Ecuadorian President Rafael Correa declared
a state of emergency in El Coca, capital of the neighboring Orellana province,
after a series of demonstrations by local residents.
In the most luxurious hotel in the city, a
Chinese man was enjoying his holidays. The 40-year-old engineer was dispatched
to Andes Petroleum from CNPC in 2004. He said he planned to go back to work
in Tarapoa the next day.
When I told him that I wanted to go to see
oil fields and showed him a memo with the name of their place, he snatched
the memo and tried to hide it.
"You must not go there. If you do so,
you will be shot by farmers," he said.
For security reasons, engineers working at
the oil facilities, including the man, are not allowed to leave the hotel,
even during holidays, without the permission of their company.
The workers are flown in and out by helicopter
rather than driven out for fear of their safety.
The engineer told me that nearly 100 Chinese
engineers are working at the oil fields.
He now earns about $5,000 (560,000 yen) a
month, nearly double the amount of those doing the same job in Beijing. His
wife and son, a high-school student, live in Beijing.
"I am away from my family. Besides, I
have been forced to work in a place with no entertainment. There is also a
risk of getting involved in accidents. So it is a matter of course that we
can receive such high salaries," he said.
Anti-American sentiments and leftist movements
have intensified in South America, and Ecuador is no exception.
Meanwhile, China is positively making inroads
into disputed countries, like Sudan in Africa, which are shunned by the United
States and European countries. Although China is criticized for such a business
style, a Japanese expert on energy issues said, "It is bringing an increase
in oil supply to the entire world."
The Chinese engineer said, "We are public
servants. So, we will go anywhere if we are told to do so."
Chinese oil companies, which had been engaged
in securing oil abroad, suffered a major setback in 2005, when one of them
failed to take over Unocal Corp. Though China National Offshore Oil Corp.
presented a favorable offer to buy out the major U.S. oil company, it was
forced to withdraw from the deal after U.S. Congress vehemently opposed the
acquisition.
After the failure, China shifted its strategy
to be more flexible in order to minimize criticism, said Guo Sizhi, a chief
researcher at the Institute of Energy Economics Japan.
When China took over a Canadian oil company
in Kazakhstan later that year, it gave about 30 percent of the company's shares
to local governments.
In January 2006, China signed a memorandum
with India to strengthen cooperation in the field of energy. As a result,
their joint purchases of oil companies were realized in Colombia and elsewhere.
Meanwhile, the Chinese government stated in
its 11th five-year plan, which started in 2006, that it aims to improve energy
consumption efficiency by 20 percent.
If the economy continues to grow in China
and India at high rates, the price of crude oil could reach a record-breaking
level of $150 per barrel in 2030, according to the "World Energy Outlook
2007," released by the International Energy Agency (IEA) in November
last year.
The ongoing price hikes of crude oil are said
to be the result of an influx of speculative money into the oil market. But
increasing oil consumption in China and other countries has also contributed
to the price hikes.
Economic growth increases the demand for energy.
The growth also causes an improvement in living standards, which means the
widespread use of cars. As a result, the dependence on oil also increases.
Chinese statistics show that China consumed
348.76 million tons of oil in 2006. However, domestic oil production has hovered
at around 180 million tons in recent years.
The IEA estimates that China's net oil imports
will more than triple by 2030, and, as a result, imported oil will account
for as much as 80 percent of that consumed by the country.
China's current energy policy is to buy natural
resources, which it is lacking, from foreign countries while refraining from
selling its own domestic stocks.
The effects of the policy were seen last summer
at the Kiwada tungsten mine in Iwakuni in Yamaguchi Prefecture, western Japan,
which had been closed for 15 years.
Low-quality ore that had remained in and outside
the pits was again exported. But the name of the country that received the
ore remained undisclosed.
Tungsten, which is a kind of rare metal, is
the main raw material needed for super-hard tools. Its price has skyrocketed
fourfold since around 2005. As a result, a buyer appeared for the ore that
had remained in the Kiwada mine for many years.
Shigeo Nakamura, president of Advanced Material
Japan Corp., a trading company that mediated the ore export, said the current
price hike is "completely different" from those in the past.
China produces 90 percent of the world's tungsten
and rare earth metals and 50 percent of indium.
The country used to export the metals at low
prices in order to acquire foreign currency, forcing many mines overseas to
shut down. But it changed its policy, placing its highest priority on meeting
domestic demand to maintain economic growth.
Based on the new policy, China curbed exports
of those metals. As a result, their prices have jumped throughout the world.
