<http://www.rice.edu/energy/research/nationaloil/index.html> The Changing Role of National Oil Companies in International Energy Markets
The project proposes to explore the influence of emerging national oil companies and partially privatized national oil companies on international energy markets. Through out the 1990s and into the next century, economic liberalization, market economy reforms and Western-style corporatization management reorganizations have characterized the oil and gas industries of major energy producing countries such as Russia, Norway, Canada and Malaysia, as well as the energy industries of major consuming countries in the developing world such as China, Brazil, Japan and India. These emerging hybrid firms, together with remaining traditional oil and gas state monopolies, control the vast majority of proven resources remaining for exploitation and development. The Western international oil majors now control less than 10% of the world's oil and gas resource base.
Ranked on the basis of oil and gas reserve holdings, 14 of the top 20 upstream oil and gas companies in the world are national oil companies or newly privatized national oil companies, according to the annual survey of Petroleum Intelligence Weekly (PIW). State monopolies represent the top 10 reserve holders internationally. By comparison, ExxonMobil and the Royal Dutch Shell Group are ranked 12th and 13th while BP and ChevronTexaco are ranked 16th and 19th respectively.
In terms of world oil production, however, only six of the top firms are national oil companies, while ExxonMobil, Royal Dutch Shell, BP and ChevronTexaco represent among the largest oil and gas producers worldwide. These Western majors also have also achieved a dramatically higher return on capital than national oil companies of similar size and operations. Of the top 20 oil and gas producers worldwide, 14 are national oil companies or newly privatized national oil companies, according to PIW. PIW's ranking shows that Saudi Aramco, Gazprom, NIOC, Pemex, Sonatrach, INOC (Iraq), PetroChina, KPC, Petrobras, Petronas, Yukos, Lukoil, PDV (Venezuela) and NNPC are among the most important oil and gas companies in the world. PIW's ranking on all measures ranks Saudi Aramco, PDV, NIOC, Pemex and PetroChina in the top 10 oil companies in the world.
The influence of national oil companies on the industry structure and pace of resource development has not been comprehensively studied and therefore is not well understood either by industry leaders or the energy policy community. These national oil companies are in the process of reevaluating and changing business strategies, with substantial consequences for international oil and gas markets. It is a time of great change inside the leadership of these national oil companies, and goals and priorities will be different than those of the Western international majors, with potentially serious consequences for market stability and oil geopolitics. The Western international majors are interested in strengthening ties with emerging national oil companies to diversify their operations and enhance supply security but strategic alliances have been difficult to form.
The gap between the high ranking of national oil companies' resource holdings and the ranking of the world's largest oil and gas production operating companies highlights a potential source of supply instability in world energy markets. The fate of emerging national oil companies, their strategies and policies, will have a substantial, long term impact on the pace of resource development in the coming years.
Asian and Russia national oil companies have increasingly begun to compete for strategic resources in the Middle East and Eurasia, in some cases knocking the Western majors out of important resource development plays. Firms such as India's ONGC and IOC; China's Sinopec, CNPC, and Malaysia's Petronas have been successful in Africa and Iran, with eyes now on investments in Saudi Arabia, Kuwait and Iraq. Russia's Lukoil is also becoming a major international player in key regions such as the Middle East and Caspian Basin. Wood Mackenzie Consultants notes that producing countries are getting more preferential financial arrangements from these firms who do not use rate of return criteria to guide their operations (see Energy Compass March 12, 2004 "Corporate Majors Under Threat"). Many of these emerging national oil companies are bankrolled or have operations subsidized by their national governments, with geopolitical and strategic aims factored into investments rather than purely commercial considerations.
Strategic investment and trade alliances for emerging national oil companies are also being sought on the basis of geopolitics rather than economic considerations. CNPC, for example, is studying forming investment alliances with Petronas and continues to desire a strategic investment in a Russian oil company. Russia, on the other hand, has shown reluctance for its oil companies to connect with Western or Chinese firms but has announced interest in forming alliances with Saudi companies.
The interplay between emerging national oil companies, major oil producing countries and Western consumer countries will have a large impact on the question of energy security and stability of oil and gas markets, raising many questions.
<http://www.rice.edu/energy/publications/nocs.html> The Changing Role of National Oil Companies (NOCs) in International Energy Markets
To view the webcast of the Houston NOC conference, please click here. Coming Soon!
1. Executive Summary
Key Findings Box
Study Presentation: Key Findings Amy Myers Jaffe March 1, 2007
2. Chinese NOCs' Overseas Strategies: Background, Comparison and Remarks Xiaojie Xu, Director Institute for Overseas Investment, CNPC Research Academy of Economics and Technology
Key Findings Box
Study Presentation: Chinese NOCs Coming Soon! Xiaojie Xu March 12, 2007
3. Petronas: A National Oil Company with an International Vision Fred R. von der Mehden, Professor Emeritus of Political Science Rice University Al Troner, President Asia Pacific Energy Consulting
Key Findings Box
Study Presentation: Petronas Coming Soon! Fred R. von der Mehden March 2, 2007
4. Lukoil: Russia's Largest Oil Company Isabel Gorst, Correspondent Financial Times of London
Key Findings Box
Study Presentation: Lukoil Coming Soon! Isabel Gorst March 2, 2007
5. A Model of the Operation and Development of a National Oil Company Peter Hartley, Professor of Economics Rice University Kenneth B. Medlock III, Research Fellow in Energy Studies James A. Baker III Institute for Public Policy
6. Empirical Evidence on the Operational Efficiency of National Oil Companies Peter Hartley, Professor of Economics Rice University Kenneth B. Medlock III, Research Fellow in Energy Studies James A. Baker III Institute for Public Policy Stacy L. Eller, Graduate Researcher in Energy Studies James A. Baker III Institute for Public Policy
Study Presentation: IOC/NOC Economic Issues: Efficiency, Priorities and Comparisons Peter Hartley March 1, 2007
7. Lord of the Rigs: Rosneft as a Mirror of Russia's Evolution Nina Poussenkova, Senior Research Fellow Russian Academy of the Sciences
Study Presentation: Rosneft Coming Soon! Nina Poussenkova March 1, 2007
8. The Nigerian National Petroleum Corporation and the Development of the Nigerian Oil and Gas Industry: History, Strategies, and Current Directions G. Ugo Nwokeji, Assistant Professor of African American Studies University of California, Berkeley
Key Findings Box
Study Presentation: NNPC Coming Soon! G. Ugo Nwokeji March 2, 2007
9. The ONGC: Charting a New Course? Sumit Ganguly, Rabindranath Tagore Professor of Indian Cultures and Civilizations Indiana University, Bloomington
Study Presentation: ONGC Sumit Ganguly March 1, 2007
10. Iraq's Oil Sector: Past, Present and Future Amy Myers Jaffe, Wallace S. Wilson Fellow in Energy Studies James A. Baker III Institute for Public Policy
Key Findings Box
Study Presentation: INOC Iraq Amy Myers Jaffe March 2, 2007
11. Saudi Aramco: National Flagship with Global Responsibilities Amy Myers Jaffe, Wallace S. Wilson Fellow in Energy Studies James A. Baker III Institute for Public Policy Jareer Elass, Energy Consultant and Editor James A. Baker III Institute for Public Policy
Key Findings Box
Study Presentation: Saudi Aramco Amy Myers Jaffe March 2, 2007
12. The National Iranian Oil Company in Iranian Politics Daniel Brumberg, Associate Professor of Government Georgetown University Ariel I. Ahram, Graduate Fellow Center for Democracy and Civil Society, Georgetown University
Study Presentation: NIOC Daniel Brumberg and Ariel I. Ahram March 1, 2007
13. Pertamina, Indonesia's State-Owned Oil Company Donald I. Hertzmark, Consultant
Study Presentation: Pertamina Donald I. Hertzmark March 2, 2007
14. Venezuela's PDVSA and World Energy Markets: Corporate Strategies and Political Factors Determining its Behavior and Influence David R. Mares, Professor of Political Science University of California, San Diego Nelson Altamirano, Visiting Scholar, Center for Iberian and Latin American Studies University of California, San Diego
Study Presentation: PDVSA David R. Mares and Nelson Altamirano March 1, 2007
15. Chinese NOCs and World Energy Markets: CNPC, Sinopec and CNOOC Steven W. Lewis, Research Fellow in Asian Studies and Economics James A. Baker III Institute for Public Policy
Study Presentation: China's NOCs Coming Soon! Steven W. Lewis March 1, 2007
16. KAZMUNAIGAZ: Kazakhstan's National Oil and Gas Company Martha Brill Olcott, Senior Associate Carnegie Endowment for International Peace
Study Presentation: Kazmunaigaz Martha Brill Olcott March 2, 2007
17. Statoil: A Study in Political Entrepreneurship Richard Gordon, President and CEO Gordon Energy Solutions Thomas Stenvoll, Market Analyst Hess Energy Trading Company
Study Presentation: Statoil Richard Gordon March 12, 2007
18. National Oil Companies and Corporate Citizenship: A Survey of Transnational Policy and Practice Matthew E. Chen, Energy Research Assistant James A. Baker III Institute for Public Policy
Study Presentation: NOCs, IOCs/ Human Rights and Sustainability Practices Matthew Chen March 2, 2007
19. NOCs and U.S. Foreign Policy Joe Barnes, Research Fellow James A. Baker III Institute for Public Policy
20. Market Structure and the Investment Behavior of International Oil Companies Coming Soon! Ronald Soligo , Professor of Economics Rice University
Study Presentation: IOCs: Investment and Industry Structure Ronald Soligo March 2, 2007 -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>