scholarly journals Learning from Failure: China's Overseas Oil Investments

2013 ◽  
Vol 42 (1) ◽  
pp. 131-165 ◽  
Author(s):  
Susana Moreira
Keyword(s):  
Risk Management ◽  
Raw Materials ◽  
Political Risk ◽  
Oil Industry ◽  
The Political ◽  
Oil Companies ◽  
National Oil Companies ◽  
Learning From Failure ◽  
Recent Developments ◽  
Poor Management

Thirsty for oil and other raw materials needed to fuel its breakneck development, China is funnelling money and manpower into an expanding number of countries in order to secure access to natural resources. This effort has successfully increased Chinese oil assets overseas but it has also exposed Beijing and Chinese national oil companies (NOCs) to significant risks. The present paper focuses on one type of risk – political risk – and how it has affected China's global quest for oil since 1993. It starts with a brief overview of political risk. It then looks at political risk management as applied to the oil industry in general. The paper continues with a discussion of the political risk management of Chinese national oil companies over time. This includes a concise examination of several instances in which the interests of Chinese NOCs have been undermined due to poor management of political risk. Recent developments suggest that Chinese NOCs are learning from these mistakes and adjusting their strategies accordingly. Still China's own socio-political context continues to hamper the ability of Chinese NOCs to deal with on-the-ground realities that are clearly much more unstable than their own.

scholarly journals Features of Political Risk Management of Transnational Corporations in the Context of Economic Globalization

2021 ◽  
pp. 162-168
Author(s):  
Ye. Bolotina ◽  
◽  
O. Shubna ◽  
A. Borodai ◽  
N. Steshenko ◽  
...  
Keyword(s):  
Risk Management ◽  
Political Risk ◽  
Transnational Corporations ◽  
Mitigation Measures ◽  
The Political ◽  
Negative Consequences ◽  
Investment Activity ◽  
Political Risks ◽  
Degree Of Risk ◽  
Foreign Trade Turnover

The article considers the specifics of the functioning of TNCs, their current activities in the investment market. TNCs are currently one of the most important actors in international economic relations. The investment activity of transnational corporations has a direct impact on the balance of payments, production volumes, foreign trade turnover, employment, and the competitiveness of the host economy. The key features of political risk management of TNCs are identified and characterized. The political risks of TNCs are related to their interpretation, classification and methods. The means of reducing the degree of risk include: risk avoidance, retention, risk transfer. Ways to reduce the degree of risk include: diversification, acquisition of additional information, limitation, insurance, hedging. It has been proven that the main advantage of risk communications as an effective ancillary way to manage the political risks of TNCs at the state level, especially in the early stages of public policy making, is that it allows decision makers to better and timely inform stakeholders about risks. and to effectively exchange data between different parts of the public administration system, including effective mitigation measures. The main directions for TNC investment in 2018 are analyzed. The negative consequences of TNCs and ways to overcome them are identified.

Contradiction of space, centralization of capital, and the hybrid state oil company: The case of Russia

2008 ◽  
Vol 1 (2) ◽  
pp. 59-71 ◽  
Author(s):  
Mazen Labban
Keyword(s):  
Oil Industry ◽  
The State ◽  
State Control ◽  
Hybrid State ◽  
Oil Companies ◽  
National Oil Companies ◽  
Russian State ◽  
And Control ◽  
Oil Company ◽  
A New Species

A new species of capital has emerged from the development of inter-capitalist competition in the oil industry. Oil-producing states have fused with financial and productive/extractive capital, foreign and domestic, into hybrid state oil companies. These are centralized monopolies that transcend the historical geographical opposition between private transnational oil companies and national oil companies. As partially nationalized state monopolies, they allow oil-producing states access to global capital markets, while retaining the control of the state over the flow of foreign capital into the domestic oil industry. They thus mediate the contradiction between the integration of capital at the transnational level and its territorial fragmentation at the national scale, only to internalize it in the process. I examine this process in the case of the ongoing consolidation of the Russian oil industry under state control, focusing on two inter-related contradictions: an attempt by the Russian state to liberalize the oil industry, yet shield it against the expansion and control of foreign oil companies; and the dependence of the state on foreign financial capital in the very process of consolidating control over the oil industry.

INDONESIA—GROWTH OF THE OIL INDUSTRY DURING 1970

1971 ◽  
Vol 11 (1) ◽  
pp. 43
Author(s):  
Ir. Soediono
Keyword(s):  
Crude Oil ◽  
Rapid Growth ◽  
Oil Industry ◽  
The Political ◽  
Political Climate ◽  
Oil Companies ◽  
The Past ◽  
Production Sharing ◽  
Start Up ◽  
To Come

The growth of the oil industry in Indonesia during 1970 was the result of Pertamina's policy of encouraging foreign oil companies to invest in the country. By the end of the year production-sharing contracts had been signed with more than 35 groups of companies.The stabilisation of the political climate under the new government enabled exploration to start up again during 1967 and the next two years saw a rapid growth in geological activity. This has led to the drilling of over sixty exploration wells during the past year, and expenditure on exploration is now in excess of $U.S. 150 million per annum. A large part of the exploration effort is directed to offshore acreage and has been rewarded with discoveries by Sinclair in 1969, followed in 1970 by IIAPCO, Union Oil and Cities Service. These finds are expected to lead to production in 1971. Production in 1970 was in excess of 900,000 BOPD, compared with 600,000 BOPD in 1966. Existing refineries are being rehabilitated, a new plant at Dumai is planned to come on stream in July, 1971, and a further refinery is proposed for Java. A polypropylene plant is being built at Pladju, South Sumatra.As the campaign against pollution intensifies, other countries, particularly Japan, are hopeful of further significant finds of the good quality, low sulphur crude oil known to exist in Indonesia.

scholarly journals Investigating Political Risk Paths in International High-Speed Railway Projects: The Case of Chinese International Contractors

2019 ◽  
Vol 11 (15) ◽  
pp. 4157 ◽  
Author(s):  
Tengyuan Chang ◽  
Xiaopeng Deng ◽  
Bon-Gang Hwang
Keyword(s):  
Risk Factors ◽  
Social Support ◽  
Risk Management ◽  
High Speed ◽  
Political Risk ◽  
Equation Modeling ◽  
The Political ◽  
Clear Understanding ◽  
External Interference ◽  
High Speed Railway

Contracting in international high-speed railway (HSR) projects is a risky business. The success of these projects and the sustainable development of international contractors are inseparable from effective risk management. However, limited research has been conducted to investigate the political risk involved in international HSR projects. As HSR development is becoming a more major part of the global construction market, this paper investigates the political risk factors specific to the projects and the relationships among the factors. Through a literature review and a pilot interview conducted with five Chinese professionals, 26 political risk factors were proposed. A questionnaire was then administered to 112 experts from both academia and industry to assess the significance of the factors. By applying partial least-squares structural equation modeling (PLS-SEM) technology, the 26 factors were clustered into eight groups, and 10 significant risk paths were identified. Specifically, “government attitudes” can directly influence the “investment profile” and “social support” can directly influence “government attitudes,” while “government instability,” “economic climate,” “financing and costs,” “external interference,” and “contractors’ operations” can indirectly influence investment profile by directly influencing “government attitudes” or “social support.” The findings of this study can assist international contractors with gaining a clear understanding of the political risk involved in international HSR projects, which will lead to more effective political risk management as well as better business decisions. Furthermore, this paper will contribute to the global body of knowledge in the area of political risk management for large-scale international projects.

scholarly journals Developing Value Proposition for Business Models of National Iranian Oil Companies

2018 ◽  
Vol 12 (1) ◽  
pp. 508-521
Author(s):  
Mohammadreza Khorshidi
Keyword(s):  
Business Model ◽  
Business Models ◽  
Oil Industry ◽  
Oil And Gas Industry ◽  
Structured Interview ◽  
Value Proposition ◽  
Oil Companies ◽  
National Oil Companies ◽  
A Value ◽  
Value Propositions

Abstract The Value proposition is one of the key aspects of a business model and plays a significant role in any business model. Nowadays, firms could be successful and even could be initiated, only when a value proposition of their business model is clarified precisely. There is a necessity for new studies in order to see whether National Oil Companies(NOCs) are promoting the proper business models that make them competitive. This research analyzes the value proposition and its influence on the NOC’s competitiveness and it supports to deliver the required products and services to their specific market segment and customers. The main objective of this research is to develop a value proposition for the business model of National Oil Companies(NOCs). This could enable firms to be more competitive in the oil industry, especially in the oil supply glut circumstance. In order to achieve this objective, the research methodology is based on the semi-structured interview with the main stakeholders in the oil industry which is NOCs. First, value propositions in the history of oil and gas industry are addressed in almost every decade, then five current or previous managers of National Iranian Oil Company are selected for the semi-structured interview to clarify the current market situation and eventually propose the desired value propositions for the business model of NOCs.

scholarly journals Derechos de propiedad, compañías petroleras, Estado y renta en Venezuela

2010 ◽  
Vol 53 ◽  
Author(s):  
Jesús Mora Contreras
Keyword(s):  
Property Rights ◽  
Oil Industry ◽  
The State ◽  
Oil Companies ◽  
National Oil Companies ◽  
Doing Business ◽  
History Of ◽  
The Way

RESUMEN: Este artículo muestra que las compañías petroleras internacionales han estado haciendo negocios en Venezuela durante más de cuatro quintas partes de casi un siglo de historia de la industria petrolera en este país (1917-2009). Muestra también que lo que ha cambiado para ellas a lo largo del tiempo es la manera de hacer negocios en la industria petrolera venezolana, valga decir, los términos y condiciones de acceso a las actividades de exploración y producción que les ha impuesto el propietario del recurso natural, relacionados particularmente con el reparto de la renta petrolera internacional. El artículo, dividido en cuatro secciones, es una síntesis de la historia del derecho de propiedad del subsuelo, de las compañías petroleras, del Estado y de la renta petrolera internacional en Venezuela desde 1920 hasta el presente. ABSTRACT: This paper shows that in almost a century of history of the Venezuelan oil industry (1917-2009), International Oil Companies (IOCs) have been doing business in this country for just more than fourth fifth of this period (74/92 years). It shows too that during that time, what has been changing in this country for the oil companies, IOCs or National Oil Companies (NOCs), is the way of doing business in the upstream of the oil industry: the terms and conditions of the owner of the underground property rights. Terms and conditions mean in this context how much of the oil generated rents in the underground public and national property rights goes to the pockets of the oil companies and government. This paper summarizes the history of the underground property rights, oil companies, the State, and rent in Venezuela from 1920 up to the present.

scholarly journals THE EFFECTIVENESS OF INTERVENTIONS IN THE FIELD OF EXTRACTION AND PROCESSING OF HYDROCARBON RAW MATERIALS IN NOVOSIBIRSK REGION

2019 ◽  
Vol 2 (5) ◽  
pp. 176-183
Author(s):  
Irina Provornaya
Keyword(s):  
New Technologies ◽  
Raw Materials ◽  
Oil Industry ◽  
Economic Indicator ◽  
Petroleum Products ◽  
Oil Refining ◽  
Oil Companies ◽  
Novosibirsk Region ◽  
Regional Budget ◽  
Regional Product

Based on the multivariate spatial model, the paper shows the relationship between the factors of the oil industry (oil production, oil refining, consumption of basic petroleum products) and the main economic indicator (gross regional product) of the Novosibirsk region. It is revealed that with the increase in the capacity of the MIC-oil and subject to further exploration of oil fields with the use of new technologies, revenues to the regional budget from oil companies in the region can be about 5 %. The measures aimed at increasing the level of social responsibility and improving the quality of the environment at the enterprises of the oil industry of the Novosibirsk region are defined.

New Challenge in Latin American and Caribbean Oil Spill Control: Offshore Prevention and Response after the DWH Milestone

2014 ◽  
Vol 2014 (1) ◽  
pp. 1-13
Author(s):  
Carlos Sagrera
Keyword(s):  
Latin American ◽  
Oil Industry ◽  
Oil Companies ◽  
Incident Command ◽  
Emergency Situations ◽  
National Oil Companies ◽  
Production Stages ◽  
Oil Sector ◽  
Spill Control ◽  
Latin American And Caribbean

ABSTRACT With offshore activities at different exploration and production stages in virtually all South American countries with sea coasts, a Central American country, and some Caribbean countries, the Deepwater Horizon (DWH) disaster has not gone unnoticed among the governments and the oil industry in the area. Organizational and human errors committed and highlighted in the investigations that have successively come to light in such a world power as the U.S.—a leader in the sector—, bring to mind the realities and systemic safety failures of the schemes and procedures in force, both in the oil industry and regulatory authorities, to control these potential environmental disasters. The offshore issue has become a priority in the Latin American and Caribbean oil industry and grows because of the recurrent confirmation of new oilfields and their successful exploration by international oil companies through block concessions, which is the only way to access the required effective technology for exploitation. Over the past decades and without exception, Latin America and the Caribbean has gone through emergency situations with spills from oil tankers, explosions and fires in refineries, pipeline fires and sabotage, and explosions and sinkings of oil rigs. The shy cooperation attempts between states and national oil companies obtained few concrete results despite the efforts of regional organizations such as ARPEL. This paper emphasizes the weaknesses in response procedures and standards through specific examples of recent incidents in “the Big Three” (Brazil, Mexico, and Venezuela), which could become worse in the current offshore deep and ultra-deep water scenario. It challenges the National Contingency Plans that must now include offshore goals and an organization scheme, such as the Incident Command System, which must be adapted as soon as possible due to the new scenarios and the need for effective inclusion of environmental actors previously relegated. The paper also outlines response strategies applied in DWH and their possible use in offshore scenarios in the region, which will require coordinated efforts by all stakeholders. It emphasizes that this is an excellent opportunity for operational improvement of the Latin American and Caribbean oil sector with respect to safety, emergencies, and spill control.

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