Wednesday, June 11, 2014

Defending Energy Imports

China's efforts to defend their seaborne imports of energy are being supplemented by efforts to diversify their imports via overland routes. Expect China to worry about defending these land import routes, too. Russia should take note.

The 2014 DOD China report notes China's energy strategy, which includes diversifying energy import sources:

In 2012, China imported approximately 60 percent of its oil; conservative estimates project that China will import almost two-thirds of its oil by 2015 and three-quarters by 2030. China looks primarily to the Persian Gulf, Africa, and Russia/Central Asia to satisfy its growing demand, with imported oil accounting for approximately 11 percent of China’s total energy consumption.

A second goal of China’s foreign energy strategy is to alleviate China’s heavy dependence on Sea Lines of Communication (SLOCs), particularly the South China Sea and Strait of Malacca. In 2012, approximately 84 percent of China’s oil imports transited the South China Sea and Strait of Malacca. Separate crude oil pipelines from Russia and Kazakhstan to China illustrate efforts to increase overland supply. In 2013, Chinese and Russian oil companies were in the late stages of negotiations to double the capacity of the crude oil pipeline that delivers Russian crude oil to China from 300,000 barrels per day (b/d) to 600,000 b/d. A pipeline that would bypass the Strait of Malacca by transporting crude oil from Kyuakpya, Burma, to Kunming, China, was completed in 2013 and is expected to commence operations in 2014. The crude oil for this pipeline will be supplied by Saudi Arabia and other countries in the Middle East and Africa.

Given China’s growing energy demand, new pipelines will only slightly alleviate China’s maritime dependency on either the Strait of Malacca or the Strait of Hormuz. Despite China’s efforts, the sheer volume of oil and liquefied natural gas that is imported to China from the Middle East and Africa will make strategic SLOCs increasingly important to China.

One, China can't avoid the need to defend their energy SLOC against American or Indian naval power. So this effort to build land lines of supply will not nullify our ability to hurt China's economy during a war by blockading China.

But just as significantly, China is creating the need to also defend land lines of energy supply to China.

Just as China devotes resources to building naval and air power to protect energy imports (and seaborne trade, in general) from the United State Navy, China will need to devote resources to air and ground power to protect overland energy imports from those who might interrupt that flow.

Which would include Russia, which has a demonstrated willingness to cut off energy exports for political goals. China likely notices that. Which won't be good for Russia, I think, in addition to helping us and our Pacific allies by diluting Chinese military power.

This isn't even a particular slam against China. Remember that the predecessor to our Central Command--the Rapid Deployment Force--was created in no small part to be a force capable of securing our Persian Gulf oil supplies if exports to us or the West were cut off as a hostile act (by locals or by Russian conquest). It's a reasonable concern for China just as it was a reasonable concern for us.

I'm just noting the situation and pointing out that Russia might not like the logic of their energy "victory."

I love it when a plan comes together.