Wednesday, January 06, 2010

Breakdown of Australian natural gas deal shows China becoming more market savvy

On January 6, 2010, Dr. Wenran Jiang was quoted by the Canadian Press on the recent breakdown of PetroChina's deal to invest in a US$40-billion Australian natural gas project and the message it sent to Canada.
For Dr. Jiang, it shows that Chinese national oil companies are getting more sophisticated in dealing with the international market, and resource-rich countries like Canada can't sit idly by and wait for Chinese investment to roll in.

The deal would have seen the Chinese state-owned firm buy up to three million tonnes of liquefied natural gas per year from the Australian offshore project for up to two decades.

While PetroChina did not immediately offer an explanation for its move Tuesday, observers said the Australian project likely lost some of its financial appeal since it was first conceived in Sept. 2007.

"You can see that when the market is not that favourable, they just drop it like that," said Dr. Jiang.

You can read the full story here.