Iraq and Chinese ProfitsPosted: June 3, 2013
Interesting article about how the Chinese, state owned, companies are getting along with the Iraq’s to flow the oil out to China.
The article shares the following interesting information.
“Chinese companies do not have to answer to shareholders, pay dividends or even generate profits. They are tools of Beijing’s foreign policy of securing a supply of energy for its increasingly prosperous and energy hungry population. “We don’t have any problems with them,” said Abdul Mahdi al-Meedi, an Iraqi Oil Ministry official who handles contracts with foreign oil companies. “They are very cooperative. There’s a big difference, the Chinese companies are state companies, while Exxon or BP or Shell are different.”
International energy experts said the Chinese had a competitive advantage over Western oil companies working in Iraq. They noted that the Chinese, unlike many Western oil companies, are willing to accept service contracts at a very low per barrel oil fee without the promise of rights to future reserves. While private oil companies need to list oil reserves on their books to satisfy investors demanding growth, the Chinese do not have to answer to shareholders.
The Chinese companies and their workers also win high marks for their technical expertise, as long as they are not working in complicated oil fields, like those in deep waters. “They offer a lot of capital and a willingness to get in quickly and with a high appetite for risk,””
Here is a great article that explains what was really going on….