Petrochin China's National Energy Needs

Introduction

Nowadays, petroleum is one of the most important commodities in the world. The countries that produce petroleum used it as a bargaining tools. They are depending on petroleum resources to develop military, technology, and transportation industries, since World War I (WWI) (Yergin, 1991). As one of the countries that has great economy growth rate in industry and high population. China also has an interest in competition with developed countries to control the world of commodities, especially in oil and gas sector. The industrial company China's oil and natural gas that play an important role in to supply country's national energy needs such as CNPC (China National Petroleum Corporation), CNOOC, Sinopec, and PetroChina (Yudono,

PetroChina is a son of CNPC, which is recognized as the largest oil and gas producer and supplier in China with 2,600 billion RMB as total assets. It was established in November 5th, 1999 as joint stock company type with restricted responsibilities. CNPC become the main sponsor and controlling shareholder of PetroChina. It can be considered as CNPC’s son. Many activities such as exploration, development, production and marketing of crude oil and natural gas; refining, transportation, storage and marketing of crude oil and oil products; the production and marketing of primary petrochemical products, derivative chemicals and other chemicals; transportation of natural gas, crude oil and refined oil, and marketing of natural gas, become PetroChina activities.

The vision of PetroChina is become an integrated international energy company, and very competitive in becoming one of the major and distributors of petroleum and petrochemical products in the world.

PetroChina International has 9 domestic branches and 7 overseas branches, and has 78 site for refining and chemical production and from 43 countries. PetroChina are operating in 26 states with employees of 400,000 people and thorough operation. PetroChina managed to build an international transit point, among others, in Minas, Basra (Iraq) and Oman for the purpose of oil refining, gas, and supporting

In the other hand, the consumption of oil in China is increasing due to the development of its industry and population growth. It increased from 2.9 million barrels a day to 5.4 million barrels (Horsnell, 2000). Industry sector in China consumed more energy than any other sector. In 1995, it recorded that oil consumption in industry sector had reached 49%. Although, it has heavy energy consumption, industry sector is holding one of the most important role in Chinese economy. There is a tendency that economy growth is equal with the energy consumption level, it is found by a research conducted by Ruth A Judson (1998). To overcome this energy supply problem, Chinese government was deciding to take some steps. For instance, the government gave the encouragement to state owned enterprises to do overseas investment, and also being the main actor in oil and gas industry all over the world.

China needs for energy, especially oil and gas, is forcing the government to change their policies. China is became more open in their political policies, than before. The effort to protect the supply for national energy is summarized in White Paper on National Energy policy in 2001. After that, the Chinese government start conducting the expansions and penetration to countries which has rich saving in oil and gas