The shaping effect of the Belt and Road Initiative on China’s international oil and gas cooperation strategy

Abstract

The Belt and Road Initiative (BRI) was launched as a leitmotif of China’s economic diplomacy in 2013 after Xi Jinping assumed power. Inevitably, China’s behaviors in international oil and gas cooperation have been influenced by the BRI in terms of policy purpose, cooperation model, business organization, and even energy security strategy. Under the BRI, China’s originally primary purpose of natural resource access in oil and gas cooperation has shifted to a business-based strategy. Meanwhile, China has constructed oil and gas pipelines as common interest-based interconnections of infrastructures, instead of getting involved in geopolitical games. In the process, China and large national companies play as partners and coordinators more often even as their traditional roles are operators and majority shareholders. Coupled with the transition of purpose, the cooperation model also changes to an industrial chain-based model. China’s overseas oil and gas cooperation transitioned from an “upstreamdownstream integration” model to a “module plug-in” model, which flexibly includes natural resources, trade, transportation, refining and engineering services to prompt the “going-out” of China’s technology, equipment, and industrial capacity. In the organization of international oil and gas cooperation, coordination among the majors of Chinese national oil companies, and between national oil companies and other actors has become independent. The Yamal project provides an empirical case that displays China’s transition in international oil and gas cooperation under the BRI in this article.