Transparency and Rule of Law Can Bolster Asian Hydrocarbons Investment in the Americas
Transparency and Rule of Law Can Bolster Asian Hydrocarbons Investment in the Americas
A new AS/COA energy report recommends that Latin America strengthen regulatory and taxation frameworks to attract strategic investment from Asia.
China, Japan, and India offer insight on attracting strategic investment from the Pacific.
New York, October 7, 2014—A new Council of the Americas’ Energy Action Group (EAG) report, Asia’s Growing Interest in Hydrocarbons from the Americas: A Snapshot, recommends that Latin American countries strengthen their regulatory and taxation frameworks in order to attract strategic investment in energy projects from Asian nations including China, Japan, and India.
"From the Canadian oil sands to the Orinoco Belt, the Brazilian pre-salt, Vaca Muerta in Argentina, and numerous opportunities in between, Asian investment has exploded, led by but not limited to China," the report says. "This is likely now a long-term phenomenon. Asian interest and investment in the hemispheric energy sector will only continue to expand."
Chinese national oil companies (NOCs) have emerged as significant players in the Western Hemisphere’s hydrocarbons sector, the report states. In 2005, NOCs accounted for only 3 percent of deal flow, but by 2012 investments had increased to 15 percent. At the same time, imports from the Americas only account for a small percentage of total Japanese consumption, but continued instability in the Middle East among other factors means that Japanese companies are looking for new opportunities in energy. India’s energy engagement with the region has also grown with oil imports from Latin America increasing from 4.5 percent in 2003 to 11 percent in 2013. Currently, eight Indian companies are part of 12 joint ventures in Venezuela, Brazil, Colombia, Ecuador, Cuba, and Peru.
"Asian countries are seeking energy investment in the Western Hemisphere’s hydrocarbons sector for economic and strategic reasons. Further participation will be beneficial to both sides through transparency, rule of law, and local engagement," says COA's Director of Energy, Christian Gómez Jr.
View the full report here.
Access other Council of the Americas’ Energy Action Group (EAG) reports here.
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