President Xi Jinping visited Saudi Arabia, Egypt and Iran for his first visit in 2016, and the relations between China and Middle East countries have become the focus of public attention. Expanding the Middle East circle of friends and enhancing energy cooperation with Middle Eastern countries is crucial to deepening China's relations with the Middle East and mutually beneficial cooperation.
Why is it so important? Just look at the following pictures and you will know.
▲Schematic diagram of oil fields in the Middle East. (Data photo)
According to the data from Xinhua News Agency's Commodity Spot Contract Trading Center in 2015, has proven crude oil reserves, five Middle Eastern countries (first place Saudi Arabia, fourth place Iran, fifth place Iraq, sixth place Kuwait, and seventh place UAE, with a total reserve of 716.4 billion tons, accounting for about 40% of the world's proven oil reserves). is worthy of being a country in the "oil sea"!
每年，中国都从中东进口大量的石油和天然气，以2014年的数据为例：
▲2014年度各国向中国出口原油的数量。 (Data photo)
▲48% of China's crude oil imported from the Middle East in 2014. (Data photo)
From January to November 2015, China imported 17.55 million tons of LNG (about 24.2 billion cubic meters), accounting for 14% of the imported gas. China's LNG imported mainly comes from Qatar, Australia, Indonesia, Malaysia, Papua New Guinea and other countries. As the world's largest LNG producer, Qatar contributes 1/3 of the world's total LNG production.
The first choice for oil from overseas is cooperative development, followed by import trade. Since investment in overseas oil and gas projects is often led by large state-owned enterprises such as CNPC, Sinopec and CNOOC, the editor will look at what oil and gas projects the three major oil companies have participated in in the Middle East today.
▲Schematic diagram of business distribution in China Petroleum Middle East Cooperation Zone.
Main oil and gas projects
Iraq
China Petroleum mainly invests in oilfield projects and engineering and technical services in Iraq, mainly including four major projects. As of December 31, 2015, the crude oil production of the Iraq project exceeded 55 million tons.
1. Ahadaib project
Ahadaib project is the first oil cooperation project restored by the Iraqi government after the Iraq War, and it is also the first cooperation project for China Petroleum to enter Iraq. On June 21, 2011, the first phase of this project was put into production with an annual capacity of 3 million tons six months ahead of schedule, becoming the first new oil field in Iraq to be put into production in more than 20 years. In November of the same year, the second phase of the annual capacity construction of 6 million tons was completed three years ahead of schedule. In the five years since its induction, the Ahadybu Oilfield has produced a total of 29 million tons of oil, becoming the main economic engine in the local area. It has made Wasit Province, where the oilfield is located, bid farewell to the history of generations of farming and given the modern oil industry a new dream.
2. Hafaya project
Hafaya project is currently the largest upstream investment project operating overseas as an operator. On December 11, 2009, a bidding consortium composed of China Petroleum, France Total and Malaysian Petroleum Corporation successfully won the bid in the second round of international bidding in Iraq. In June 2012, the first phase of Hafaya Oilfield had an annual production capacity of 5 million tons, which was the first project to be put into production among the seven projects in the second round. In August 2014, it reached the 10 million tons of oil field two years ahead of schedule. The oil field production increase effect, cost control and construction period all hit the best level of similar oil fields in Iraq.
3.Rumaila Project
Rumaila Project is the only giant oil field project that has successfully won the bid in the first round of international bidding in Iraq. It was jointly developed by China Petroleum, British Petroleum Corporation (BP), Iraq Southern Petroleum Corporation (SOC) and Iraq National Petroleum Marketing Organization (SOMO). Since the service contract was signed in December 2009, the crude oil production in the Rumaira oil field has exceeded 2 billion barrels, an increase of more than 30% from the time of the operation rights taking over five years ago.
4. The Sigurna Project
Sigurna Phase 1 oil field is located about 50 kilometers northwest of Basra, Iraq, close to the north of the Rumaira Oilfield where China Petroleum participated in the operation. The Sigurna project is China Petroleum’s first equity acquisition project in Iraq.In November 2013, China Petroleum and ExxonMobil successfully completed the project equity delivery, realizing international cooperation between China Petroleum and ExxonMobil for the first time. At present, the oil field produces about 400,000 barrels of crude oil per day.
Saudi Arabia
China Petroleum focuses on engineering and technical services in Saudi Arabia. The Saudi Arabian market has always been monopolized by major Western oil engineering technology service companies and engineering construction companies. Since the 21st century, China Petroleum has gradually entered this high-end market with its comprehensive strength. On November 1, 2003, the first contract signed by the Oriental Geophysical 8647 team and Saudi Aramco successfully operated, breaking the situation where Western exploration companies monopolize the Saudi exploration market for more than ten years. Since then, Oriental Geophysical Exploration has rapidly expanded its market share in the Saudi oil exploration market. At present, the team and market share of Oriental geophysical exploration both account for more than 1/3 of the Saudi physicist market. On January 19, 2016, Oriental Geophysical Exploration Company won the bid for the S78 large-scale three-dimensional transition zone earthquake collection project of Saudi Aramco, with a value of US$340 million. In addition, Global Engineering and Daqing drilling teams have also successfully entered the Saudi market.
Iran
China Petroleum Iran Company mainly operates the following projects: North A project, Nana A project; MIS project.
North A project and South A project
North A project refer to the development of Iran's North Azadekan oil field. Located in western Iran, the Azadekan Oilfield is the largest oil field discovered in Iran in the past 30 years and one of the largest oil fields in the world, with crude oil reserves of about 42 billion barrels. In January 2009, PetroChina signed a contract with Iran to develop the North Azadekan oil field. In August of the same year, the two sides signed a memorandum of cooperation on the South Azadekan oil field (i.e., the South Azadekan oil field). However, the Iranian nuclear crisis broke out. Starting from the end of 2010, Chinese energy companies suspended or slowed their energy projects in Iran in case they could be sanctioned by Western countries led by the United States. 2014年4月，伊朗政府以中方工程进度缓慢为由欲取消与中石油签订的25亿美元南阿项目开发协议。 On July 14, 2014, the Six-Party Talks on the Iran nuclear issue reached an agreement, and China's investment in Iran finally began to thaw. On October 28, 2015, the ground project of the North Azadekan oil field in Iran contracted by EPC of China Petroleum Engineering Construction Company was successfully poured into oil. After the completion of the first phase of the project, the production capacity is 75,000 barrels per day of crude oil and 105 million standard cubic feet per day of natural gas.
MIS project
Iran's MIS project is the first commercial oil field discovered in the Middle East. It is located in the mountainous area near the MIS city in southwestern Iran. It is jointly developed by Iran, Norway and PetroChina. The MIS oil field is the oldest oil field in the Middle East.
UAE
UAE Mande Oilfield
UAE Mande Oilfield
China Petroleum Engineering Construction Company signed a contract with Abu Dhabi Onshore Oil Company (ADCO) in May 2015 to develop the UAE Mande Oilfield for the latter, with a total contract amount of US$330 million. According to reports, the project is one of the important projects by Abu Dhabi Onshore Oil Company to increase its daily oil production from 1.4 million barrels to 1.8 million barrels, with a contract construction period of 27 months.
Qatar
Qatar offshore block 4
PetroChina acquired 40% of the oil exploration and development rights of the French Suez Energy Group Qatar offshore block 4 in July 2012, and was officially approved by the Qatar Ministry of Energy and Industry on July 25. If commercial discoveries are found in exploration, it will cooperate with Qatar Petroleum Corporation to develop oil and gas resources. Previously, China Petroleum and Shell have cooperated in the Qatar Block D exploration project. China Petroleum has a 25% stake, Shell has a 75% stake and serves as an operator.
Oman
Oman project
This is a crude oil production project jointly developed by China PetroGas and Oman PetroGas. The Daleel Oilfield where the project is located is an oilfield that was put into development in 1990, and the original operator was Japan's Japex Company. Due to the use of a depletion-based development method, oilfield production reached its peak in 1997, with a daily crude oil output of 11,000 barrels, and then continued to decline. In 2002, after China Petroleum took over the project, it vigorously promoted horizontal well water injection development technology, and the average daily output of the project rose from 4,500 barrels at the time of taking over to 42,000 barrels in 2012.
Other businesses
Engineering and technical service segment There are 179 teams of 6 companies that provide a variety of engineering and technical services such as geophysical exploration, drilling, well logging, well recording, oil testing and well repair in the Middle East market. These teams are mainly distributed in countries such as Iraq, the UAE, Iran, Oman, Syria, Yemen, Saudi Arabia and Kuwait.
Project Construction Services In terms of 5 enterprises in China Petroleum have built more than 10 projects in the Middle East, mainly distributed in the UAE, Iraq, Kuwait, Iran and other countries.
PetroChina's equipment has been exported to countries such as Iran, the United Arab Emirates, Syria, Iraq, Oman, Bahrain, Qatar, Turkey, Jordan, Saudi Arabia and Kuwait.
▲Schematic diagram of Sinopec's Middle East Oil and Gas Zone Project.
Main oil and gas projects
Saudi Arabia
Yanbu refinery
On January 20, 2016, in Riyadh, the capital of Saudi Arabia, Chinese President Xi Jinping and Saudi King Salman, who are visiting Saudi Arabia, attended the launch ceremony of the Yanbu Aramco Sinopec Refining Company Ltd. (hereinafter referred to as "Yasref") in the production launch ceremony. Previously, the two heads of state also witnessed the signing ceremony of the strategic cooperation framework agreement between Sinopec and Saudi Arabia, which will further promote broader cooperation between China and Saudi Arabia in the oil and gas industry. Yanbu Refinery is Sinopec's first overseas refining and chemical project and China's largest investment project in Saudi Arabia. In early 2012, Sinopec and Saudi Aramco signed a joint venture agreement, with shareholding ratios of 37.5% and 62.5% respectively. The refinery is located in the petrochemical area near Yanbu City in western Saudi Arabia, with a design processing capacity of 400,000 barrels of crude oil per day (equivalent to 20 million tons/year).
Other projects
Sino-Petrochemical won the bid for the development of a large natural gas field in Lebaa region in southern Saudi Arabia in the second half of 2003, with a total investment of approximately US$1.9 billion. Sinopec and Alamku signed a commercial agreement to cooperate in the development of this natural gas project in Riyadh.
Sinopec Shanghai Engineering Company, Sinopec Second Construction Company and a Dutch company, AK, formed a consortium to participate in the Saudi Sabik Company's annual production of 400,000 tons of polyethylene and 400,000 tons of polypropylene production equipment construction project. The contract amount is about US$700,000 million. The project is built in Yanbu Development Zone, the important Red Sea town, and the production line is officially put into use in March 2008.
Middle East R&D Center
On January 21, 2016, Sinopec Middle East R&D Center held a groundbreaking ceremony in Dharan Technology Valley, Kingdom of Saudi Arabia. The R&D Center focuses on basic forward-looking and applied technology research, and will be the company's applied technology research center, technology promotion support center, and advanced talent training center in the Middle East. The R&D center is located in Darland Technology Valley, adjacent to the R&D centers built by many famous engineering companies around the world in Saudi Arabia. The total construction area is 4,800 square meters and has functions such as display, R&D, and experiments.
Iran
Yadavaran Oilfield
0 Since October 2015, Sinopec can mine 85,000 barrels of oil per day in the first phase of the Yadavaran Oilfield in Iran. Like PetroChina developing the North Azadekan oil field, this is part of the $2 billion oil agreement reached between China and Iran in 2007. According to the agreement, China can establish an oil production capacity of 200,000 barrels per day in Iran.伊朗政府官员曾表示，伊朗很有可能在亚达瓦兰油田第二期中继续与中石化合作，一旦第二期项目启动，每日产量将激增至13.5万桶。
UAE
Fujairah Oil Warehousing Project
March 11, 2015, the first oil warehousing joint venture project, Fujairah Oil Terminal FZC (FUjairah Oil Terminal FZC, referred to as FOT warehousing project), completed overseas investment and construction by Sinopec Guande Holdings Co., Ltd. (SinoPeople and Chemical Corporation Overseas Warehousing Logistics Professional Company), held a grand completion and production celebration ceremony in the Fujairah Emirates Free Trade Zone. The commissioning and operation of the FOT warehousing project is an important milestone in Sinopec's international operation and will further enhance Sinopec's international oil trade capabilities.
Other businesses
Sino-Petrochemical signed 14 new drilling rig service contracts in Saudi Arabia in 2014, with a contract amount of US$1.48 billion, making it the largest overseas drilling and repair project with the largest single contract amount in Sinopec so far.
Main oil and gas projects
Iraq
Missan oil field group
CNOOC owns 63.75% of the participation rights of the technical service contract of the Missan oil field group in Iraq.根据合同，公司担任该油田群的主合同者。 In 2012, the Misang Oilfield Group entered the project recovery period. In 2013, the output of the Misang Oilfield Group gradually increased, with an average daily net output reaching 14,800 barrels.
(I) Supply and demand relationship
1. Supply: The latest IEA report this month showed that U.S. EIA crude oil inventories rose sharply by 8.383 million barrels in the week of January 22, exceeding the expected increase of 4.1 million barrels to 495 million barrels, a new high since 1930. At the same time, data showed that crude oil inventories in Cushing fell by 771,000 barrels in the week of January 22, a drop of more than the expected 400,000 barrels. U.S. refinery equipment utilization rate fell by 3.2 percentage points compared with the previous week.
2. Demand: In view of the slowdown in China's economic growth, the IEA lowered its crude oil demand expectations in 2016. The IEA pointed out that in the fourth quarter of 2015, affected by factors such as warming winter temperatures and weak commodity economy indexes, global crude oil demand suddenly fell from the five-year high in the third quarter to the lowest point of the year. It is expected that global crude oil consumption growth will slow to 1.2 million barrels per day this year.
(II) Monetary relations
1. USD: The Federal Reserve held its first FOMC meeting of the year from the 26th to the 27th. The Federal Reserve announced the January FOMC statement that it kept interest rates unchanged and stated in the statement that it would closely monitor changes in the global economy and financial markets. The Fed expects to raise interest rates slowly in the future, and does not rule out the possibility of interest rate hikes in March meeting.
2. RMB: The latest data shows that China's demand for crude oil is still at a healthy level in 2015. In December 2015, China's crude oil imports increased by 9.3% year-on-year to 33.2 million tons. However, the slowdown in growth in China may have an impact on domestic crude oil demand.
3. Euro: Data released by the European Statistics Office on January 5, 2016 showed that the initial growth rate of the consumer price index (CPI) in the euro zone in December 2015 was lower than expected, which made the European Central Bank face pressure to further increase monetary policy after increasing its easing policy in December 2015.
From a normal intuitive perspective, since international oil prices are denominated in US dollars, the US dollar index and oil prices are highly negatively correlated, and the basis for determining the strength of the US dollar index lies in the performance of US economic data and its impact on Federal Reserve policies. Among the many economic data in the United States, monthly non-farm employment is the most important data. Looking ahead to February, the U.S. Department of Labor will release its January non-farm employment report on February 5, which has an important impact on the US dollar index and crude oil trends.
From the weekly perspective, the moving average system continues to be short-sold. The current 5-week moving average is at 212. As time goes by, it will automatically move down to around 208 this week. After the KDJ index has a low golden cross, the possibility of the price entering a volatile trend is very high. The previous downward trend may come to an end temporarily (but the probability of a price reversal is not high). The short-sold is arranged below the zero axis of the MACD index, and the green momentum maintains a large volume. The overall trend of the weekly line is still bearish; a big positive in the 4-hour line pulls up, hitting the previous high point 225, and then encountering a drop in the suppression force, and the suppression above is obvious. During the rise, the bulls' momentum weakened and the bears counterattacked, but the strength was not very strong.The price is at a high level and is fluctuating weakly, and the bear power is still trying. Of course, the support force shown by the MA moving average below is also very obvious. This week, the focus is on the 205-210 line, and the focus is on the 225-230 line above. The continuous rise of oil prices on the
daily line, and crude oil prices received effective support at the 204 line. The last four trading days last week closed positively, and the price also broke the daily MA20 moving average and stood firm above it. At present, a process of retracement confirmation is needed. In the 4-hour period, the market surged to 228 and the bulls' momentum subsided. MACD was dead fork above the 0 axis, the green energy column increased in volume, and RSI and KDJ both increased in volume. At present, short positions have a slightly advantage. Pay close attention to whether the support for the daily middle track position is effective. Pay attention to the operation strategy of range 210-220
: short the first line above 223-225, stop loss 228, target 216-218;
09-211, stop loss 205, target 215-218;
Investment is risky, and operations should be cautious and stop loss should be strictly carried out. For reference only
From the perspective of the overall crude oil price trend, the medium and long-term direction is still optimistic about the rebound in the later period. The decline in international oil prices has led to the shrinking of the US and Russia economy, and the attributes of crude oil itself, it is a non-renewable resource, so it will still maintain a stable rebound trend. It is recommended to fall back and start to layout medium and long-term long orders in the future. Pay attention to the phased rebound first.
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