From today's NYT by KEITH BRADSHER As Iraq Stabilizes, China Eyes Its Oil Fields

In another sign of China’s interest in Iraqi oil fields, Sinopec, China’s refining giant, offered $7.22 billion on Wednesday to buy Addax Petroleum, a Swiss-Canadian company with operations in the Kurdistan region of Iraq and in West Africa. If Addax’s shareholders and Canadian regulators approve the deal, which Addax’s board is recommending, it would be China’s largest overseas energy acquisition.
But China’s oil consumption has soared since then, thanks to an economic boom and climbing car sales that have produced traffic jams in big cities. China surpassed the United States this year as the world’s largest car market, partly because China has weathered the global economic downturn better than the United States; China’s oil consumption reached 8 million barrels per day last year, up from 4.9 million in 2001, according to a statistical review from BP, the British oil company.

Oil production has grown much more slowly, as older oil fields have run dry. New fields, either offshore or in western China, have barely replaced them. China produced 3.8 million barrels per day of oil last year, up from 3.3 million barrels per day in 2001, which still left the country dependent on imports for more than half its oil.

Iraq has the world’s third-largest proven reserves, after Saudi Arabia and Iran. Many geologists say that the true oil resources of Iraq are even greater than official statistics suggest, because Iraq’s oil industry has suffered from decades of disruption and underinvestment. Many oil fields have not been fully explored as a result.

Addax has oil licenses in two oil fields in northern Iraq, the Taqtaq and Sangaw North fields, both near Kirkuk, and its drilling has already struck large quantities of oil repeatedly in the Taqtaq field.