In a major piece in the current edition of Foreign Affairs, two fellows at the Brookings Institute, argue that, as part of its efforts to constrain Iran, the US government should encourage China to shift its focus from deepening its involvement in the development of Iran’s oil and gas resources, to increasing its participation in US projects. Getting China to Sanction Iran, Foreign Affairs, March/April 2011.
From the article:
Just as important as the diplomatic dimension will be the Obama administration’s efforts at home. First, the White House should encourage China’s NOC’s [National Oil Company’s] to invest in the United States instead of Iran.
“Capitol Hill’s furious reaction helped derail the 2005 bid by the Chinese energy giant CNOOC to buy the California-based Unocal. The Obama administration and Congress must work closely to prevent such a scenario from unfolding again, particularly since China is a convenient scapegoat for U.S. legislators. It is promising that CNOOC recently was able to purchase a 33.3 percent stake in the American gas company Chesapeake Energy’s Eagle Ford Shale project in Texas. Ensuring that more such projects proceed without domestic backlash would emphasize to Beijing the potential benefits of cooperating with Washington on its Iran policy.”
Bottom Line: The world continues to evolve. Those who continue to believe that the US Government automatically would raise objections to the export of Alaska LNG to China, or the investment by Chinese oil companies in Alaska projects should reassess their thinking.