China and the Global Energy Crisis

China and the Global Energy Crisis

Development and Prospects for China’s Oil and Natural Gas

Tatsu Kambara and Christopher Howe

This book examines China’s record of oil and gas development, its refining capacity, and energy prospects. The authors conclude that there are no fundamental reasons for anxiety about China’s demands on the world energy economy, but they emphasize that its energy future will depend critically on a continuation of reform and internationalization. China and the Global Energy Crisis is a concise but detailed study of these issues.

Introduction

Tatsu Kambara and Christopher Howe

Subjects: asian studies, asian development, asian economics, asian innovation and technology, asian politics and policy, development studies, asian development, economics and finance, asian economics, energy economics, environmental economics, environment, asian environment, environmental economics, innovation and technology, asian innovation, politics and public policy, asian politics

Extract

The rapid economic development of China during the past two decades is proving to have profound implications for China’s energy situation. China’s GDP increased fourfold between 1980 and 2000, while primary energy consumption approximately doubled in the same period. By 2004, China’s primary energy consumption had risen to 1386.2 million tons of oil equivalent (mtoe). Of this, coal supplied 68 per cent and oil 23 per cent. In the same year, while China’s domestic output of crude oil had reached 174 million metric tons (mmt), consumption of petroleum products was reported to be 300 mmt – a huge gap that has had to be filled by imports. According to official statistics, net imports of crude oil in 2004 reached 117 mmt and oil products imports were an additional 26.4 mmt. In global terms, therefore, China produced only 4.5 per cent of the world’s oil but consumed 8.2 per cent.1 Bearing in mind that at present Chinese per capita energy consumption levels are less than one-tenth of those in the USA and one-seventh of those in Japan, the scale of the future potential of Chinese consumption and its world impact are both obviously important. On present estimates, energy consumption in China is likely to increase by two- to threefold between 2000 and 2020. Within this total, if oil is to maintain its recent share of energy supply, it is likely that more than 60 per cent of all oil will have to be imported. This far-reaching transformation is all the more...