China heads to South America in global energy 'scramble'
China's global hunt for crucial energy supplies is taking it into America's backyard, with two Chinese state firms winning production rights to a multi-billion-barrel deepwater oilfield off Brazil.
China National Petroleum Corp. (CNPC) and China National Offshore Oil Corp.(CNOOC) each took a 10 percent stake in Brazil's "Libra" field, alongside three other companies, at an auction on Monday.
Beijing is seeking oil, natural gas and other raw materials to keep the world's second largest economy moving and the government has is encouraging companies to "go out" and make acquisitions to gain both market access and international experience.
"Everyone is scrambling for resources worldwide," said Li Li, an analyst at consultancy C1 Energy.
"The whole of South America is relatively less developed with both abundant reserves and these kind of resources, so Chinese companies are more interested," she said.
China is already the biggest energy user in the world and the Organization of Petroleum Exporting Countries (OPEC) says it could also surpass the United States as the largest oil importer by 2014.
The chief executive of CNOOC, China's main offshore oil producer, said the latest deal will allow entry to an "ultra" deepwater field.
"It also aligns with our philosophy of seeking partnerships to expand our global footprints," Li Fanrong said in a statement.