CONFIDENTIAL
HKK 162/1
ملل
72 OCT 1980
W Dorward Esq OBE from
OBE from A
HRK 162/2
*162/2
RECEIVED
IND
And
Director of Trade, Industry and
Customs
Ocean Centre
5 Canton Road
IN 1920 233-4381
DESK OFFICES
PA
REGISTRY
Action Takan
Поз
2 June 1980
8
Kowloon, HONG KONG
see
PROSPECTS FOR CHINA OFFSHORE OIL: HONG KONG INTERESTS
1. You will recall that when you were in London in March, you mentioned to Dick Clift and me your concern that British indus- try would fail to grasp the opportunities which you hoped would appear in Hong Kong as the oil service and down-stream industries develop there, on the assumption that there are large-scale discoveries of oil in the Yellow, East China and South China Seas.
2. We have recently had the opportunity to discuss this inform- ally with BP. Hugh Davies (FED) and Tony Millson (ESSD) and I had lunch with Norman Macfarlane, BP's Area Coordinator for the Far East and South-East Asia, David Olliver and Feter Bevan from the exploration side.
3. We found BP somewhat cagey with regard to the prospects for offshore China. They thought, like all good oilmen, that too much importance was being attached to the size of the readings so far available and that nothing could be assured until actual drilling had taken place. They expected the Chinese to be licensing lots for exploration around the middle of next year.
4. We encouraged the BP people to talk about what might happen on the assumption that oil was found in substantial quantities. Macfarlane thought that the oil would almost certainly be landed in China, probably by pipeline. They were initially reluctant to be drawn on any role that Hong Kong might have but did con- cede that, depending on location of wells, it would be perfectly feasible for some oil to be taken from the well-head by ship directly to Hong Kong, but that it would be more likely that the Chinese would insist on it being landed on mainland China and then trans-shipped to Hong Kong.
5. BP confirmed our view that Hong Kong's role in the develop- ment of China's oil industry would be largely dependent on the attitude of the Chinese Government itself. BP's present assess- ment was that China would adopt a policy similar to our own, i.e. landing it in China and having as much refined locally as possible so as to enjoy the maximum financial benefit.
We did
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CONFIDENTIAL