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State-Owned Companies Own 95% Of Oil

There are some surprising details buried in this article from Agence France-Pressee:

Despite rocketing prices, outlook is bleak for oil majors

by Delphine Dechaux Sun Jul 6

MADRID (AFP) – Despite record crude prices, the major oil companies are struggling to access resources that are being jealously guarded by national companies with whom they are forced to establish partnerships.

As paradoxical as it may seem, high oil prices do not mean a golden age for the likes of ExxonMobil, Chevron, Totalor BP.

Of course, with a barrel of oil at more than 140 dollars, they are seeing major profits, but the future has never seemed so uncertain.

The problem is access to reserves. The oil majors now control less than 10 percent of world resources of gas and oil, against 70 percent in the 1970s, according to figures released by the office of Ernst and Young at the World Petroleum Congress in Madrid.

As a result they are being forced to explore in increasingly extreme conditions.

"Oil in deep water or in regions that are difficult to access (such the Arctic) are what are left for international companies," said Christophe de Margerie, the head of French group Total.

The majors are also competing with the national oil companies, which are not content to just enjoy direct access to the resources of their respective countries but are making inroads elsewhere.

"National hydrocarbon companies are no longer confined to within their borders," OPEC president Chekib Khelil said, citing the examples of China’s Sinoc and CNPC, Malaysia’s Petronas or Algeria’s Sonatrach.

"A lot of international companies were previously national companies, such as BP and Total," said Khelil.

"It’s more and more difficult now to know which are national companies and which are majors because the majority of the nationals are becoming internationals," said Linda Cook, head of gas and electricity at Anglo-Dutch Shell…

But the majors can longer appear to be preying on the countries where they are operating.

"We can do a lot of things more than our regular work, such as education and training," said de Margerie. "It is essential for Total to go beyond its traditional role."

Did you notice this little detail, mentioned in passing?

The problem is access to reserves. The oil majors now control less than 10 percent of world resources of gas and oil, against 70 percent in the 1970s…

Actually, according the April 16, 2007 edition of Forbes Magazine, "big oil" only controls 5% of the world resources:

1GOCs— A: Saudi Aramco B: NIOC (Iran) C: Qatar Petroleum D: ADNOC (UAE) E: Iraq NOC F: Gazprom (Russia) G: KPC (Kuwait) H: PDVSA (Venezuela) I: NNPC (Nigeria) J: NOC (Libya) K: Sonatrach (Algeria) L: Rosneft (Russia) M: Petronas (Malaysia) O: Lukoil (Russia) P: Pemex (Mexico) Q: Petrochina (China) T: Petrobras (Brazil) Y: ONGC (India) Z: Sinopec (China). 2IOCs— N: ExxonMobil R: BP S: Chevron U: Royal Dutch Shell V: Total W: ConocoPhillips X: ENI.

That’s right. 95% of the world’s known oil and gas reserves are controlled by national oil companies, not "Big (Bad) Oil."

It is also interesting to note this also means that 65% of the world’s oil and gas has been "nationalized? since the 1970s.

No wonder we’ve got trouble.

This article was posted by Steve Gilbert on Monday, July 7th, 2008. Comments are currently closed.

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