Interesting article from today’s Financial Times about China’s search for oil in Africa. It states: “Conventional wisdom suggests that China’s energy companies are marching across Africa, shoving aside established majors and grabbing huge oil reserves with the help of bottomless funding from Beijing.”

“A closer look reveals a more nuanced picture: China’s giants have won only a fraction of the continent’s crude, state backing has shown its limits, and they are perhaps more image-conscious than many people think.

China, projected to become the world’s biggest oil importer soon after 2010, is likely to seek ever greater supplies from Africa to keep the engines of its economic boom revving. But experts say its state-owned companies are likely to face a challenge finding the kind of low-profile, high-yielding fields that western majors may have overlooked.

“Chinese oil companies are looking for already-producing, or near-producing, low-visibility kinds of oil fields,” says Dapo Odesanya, a partner with Andaz Global Solutions, a Beijing-based oil and gas consultancy. “That is a very difficult combination of characteristics to get but that’s the kind of thing they’re looking for.”

Although the Chinese have invested in West Africa in recent years, Chinese national oil companies produced about 267,000 barrels of oil equivalent a day in Africa in 2005 – only one-third of the amount produced by ExxonMobil. It is estimated that the Chinese hold less than 2 per cent of Africa’s discovered oil and gas reserves.

“Contrary to public opinion, China’s national oil companies are not ‘locking up’ the lion’s share of African oil as part of a centralised quest for energy,” wrote Erica Downs, a China specialist with the Brookings Institution, in a recent paper. “With the exception of a handful of projects in Sudan, Nigeria and Angola, most of the African assets held by China’s national oil companies are of a size and quality of little interest to international oil companies.”