Posted by Dayuhan

I don't think the Chinese are likely to make troubkle in the Middle East. Trouble in the Middle East typically means higher oil prices and potentially even interruptions; they are major buyers and they have a strong vested interest in not rocking that boat. Of course they are also opportunists, and if we give them a chance to score a propaganda point or two, they'll take it
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Applying simple logic based on your personal perception of the matter doesn't reflect China's strategic outlook. It is much more complex than this, and as China has demonstrated this past year they have no problem rocking the boat. This is wishful thinking not reflected in China's strategic behavior.

Posted by Carl

Dayuhan makes a good point that the exploration is likely to be done by smaller companies. But small or large company, I don't see the situation you describe as being likely to develop because the companies aren't going dispatch rigs and ships unless they are very confident that they aren't going to end up targets. If I was running one of the companies it would be difficult to explain to shareholders, board members and creditors why I sent very expensive rigs and crews someplace where they were emulating half of Jones' pronouncement-slow ships going into harm's way.
Yes and no, I have been in a lot of conflict zones and there was never a shortage of major oil companies being present. They'll take the risk if they think the profit is sufficient. The fact that Exxon is making a deal with Kurds against the wishes of Baghdad is putting their southern assets at risk, but Exxon publically stated they think the risk is worth it. They have to compete with other oil companies to get their claims/bids in, which appears to force them to move faster and accept more risk, or assume the greater risk of not being able to produce oil there. Oil companies have been attacked several times by terrorists in the Middle East, North Africa, West Africa, South America, and even in SE Asia, not to mention pirates, etc. These companies will definitely take on risk up to a point.

http://www.reuters.com/article/2012/...8701LM20120801

Analysis: China unveils oil offensive in South China Sea squabble

"The Chinese government's stance is clearer than ever ... They want to take on and develop this region," said an executive at a global oil major, who declined to be identified because of the sensitivity of the matter.

"China's view is that the little countries, like Vietnam and the Philippines, are increasingly stealing its resources and it must demonstrate it is serious about upholding its claims," said Ian Storey, a senior fellow at the Institute of Southeast Asian Studies in Singapore.

"There are hundreds of independent upstream companies in the world willing to go anywhere for a small volume of oil to turn a profit," said Kang Wu, managing director of consultancy FACTS Global Energy.

"Companies will go to the disputed South China Sea and rely on the Chinese government to protect them and ensure that drilling is safe. If they cannot get those guarantees, then they don't drill, don't spend a penny, and don't lose."
Read the entire article, it provides some useful insights. This is exactly what I was making reference to, American companies, among other others, asking for Chinese protection.

http://www.businessweek.com/news/201...arded-to-exxon

Vietnam Warns China to Halt Oil Bids in Exxon-Awarded Area

PetroVietnam will “unwaveringly oppose” any foreign companies that sign contracts with China to explore for oil in the nine areas, Hau said. “The Vietnamese government will not allow any implementation of these exploration activities.”
“This is one way for China to assert its maritime territory,” he said by phone. “There’s probably more to come. Domestic pressure was building up so they had to do something.”
China’s blocks overlap with Vietnamese areas that have been awarded to Exxon, Moscow-based Gazprom (OGZD), India’s Oil & Natural Gas Corp. and Talisman Energy Inc. (TLM), according to a PetroVietnam map shown to reporters in Hanoi.
Exxon has not responded to querry yet.