Driven by concerns over stability, China is stepping up cooperation with its neighbors, aiming to secure supplies of oil and natural gas from regional sources instead of the Middle East.
China is especially eager to secure deals to receive oil and gas from neighboring countries by pipeline because fixed routes lock suppliers into long-term relationships and Chinese leaders view pipelines as safer than delivery by sea.
Last week, Chinese President Hu Jintao signed agreements with Turkmen President Saparmurat Niyazov for Turkmenistan to sell China natural gas and to build a pipeline to deliver it.
Under terms of the agreements, China will purchase 30 billion cu m/year of natural gas from Turkmenistan over 30 years, starting from the date the proposed Turkmenistan-China gas pipeline is commissioned in 2009.
Terrorist concerns
The two sides also agreed to jointly carry out exploration and development of all fields on the right bank of Amu Darya River under a production-sharing agreement.
Not least, they also signed a joint pledge to crack down on terrorism and extremism-a reference to their common fear of radical Islamic groups. The agreement with Turkmenistan adds to a multibillion-dollar string of deals China has made recently to import oil and gas.
Kazakhstan opened a pipeline to deliver oil to China in December, while in March, Russian President Vladimir Putin said his government would build a pipeline to deliver gas to China and a pipeline spur to deliver oil from the mainline to be constructed from eastern Siberia to the Pacific Coast.
Leaving no source unconsidered, China even has reached an agreement with its Southeast Asian neighbors Laos, Myanmar, and Thailand to ship oil along the Mekong River, which rises on the Qinghai-Tibet Plateau and flows through China, Myanmar, Laos, Thailand, Cambodia, and Vietnam to the South China Sea.
Straits of Malacca
The agreement describes the Mekong River as a link of peace and friendship by strengthening joint security mechanisms to safeguard oil shipping and the lives and property of maritime workers.
While the river may provide such an alternative, there are still problems to be worked out.
According to traders in Thailand’s northern border town of Chiang Rai, the falling water level of the Mekong River has affected the country’s trade with China by forcing boats to reduce their cargo capacity to survive the journey. Still, Qiao Xinmin, director of China’s Maritime Affairs Bureau of the river, said the cooperation framework for the Greater Mekong Subregion allows a monthly quota of 1,200 tonnes of oil to be shipped on the waterway.
Qiao said the agreement is expected to provide China with an alternative to the Straits of Malacca-a haven for pirates and possibly terrorists-as a route for oil shipping. He did not say, however, just where the oil would originate or how much traffic the river would bear. ✦