China involved in an Iran-Oman gas deal?
Oman may be playing a waiting game, possibly dependent on the outcome of the US elections, although equally dependent on whether the charges that Iran will make for its gas are acceptable. Its cousin in the Gulf, Bahrain, has already stated that it will press ahead with negotiations to buy gas from Iran, despite any possible objections from the USA, with which, like Oman, it has a free-trade agreement. The Financial Times of 23rd October quoted observers as doubting that the deal would go ahead given Bahrain's reliance on both Saudi Arabia and the USA, neither of which have could be described as having good relations with the Iranian Islamic Republic. The article speculated that Bahrain might be trying to 'persuade' Saudi Arabia to intervene with Qatar which has put a moratorium on its North Field until 2010, by 'flirting' with the idea of importing gas from Iran.
Oman has already begun to receive gas from Qatar via the Dolphin pipeline , but needs substantially more to fuel its power needs and development projects .
More worryingly for Oman, speculation has appeared on a Texas-based ezine website called Energy Tribune that China is trying to obtain oil from Iran using Oman's LNG facility. I quote:
China is now trying to get Iranís energy supply in a roundabout way. CNPC is in talks with Oman to build or use its existing energy infrastructure to import Iranís LNG. In so doing, CNPC hopes to dilute possible U.S. criticism. CNPC is also eager to secure a contract to develop the second phase of Iranís Kish gas field. It is doing an independent study to build a pipeline to move the Kish gas to Omanís Qalhat LNG plant for liquefaction, and then ship the fuel to China.Qalhat LNG did indeed sign a master sale and purchase agreement with China National Offshore Oil Corporation (CNOOC) in September with little in the way of detail on what the agreement involved. Reportedly, Oman has restricted exports of its own LNG in order to fulfil its domestic needs, so how is the country in a position to agree to further exports?
While this speculation may be too far-fetched, it's impossible to entirely refute it without more detailed information being published.