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#Geoeconomics, Chinese soft power: shipment of crude oil from Niger to China restarts

Benin's embargo on Niger's oil exports has affected the Niger government's crude oil marketing project with the China National Petroleum Corporation (CNPC). A Chinese delegation requested a meeting of the Benin-Niger Interstate Commission to resolve the dispute between the two countries. Some observers see the quick resolution as a sign of China's economic and diplomatic clout in both countries and Beijing's growing capabilities as a mediator, able to protect Chinese investments in volatile environments.



According to Hong Kong's South China Morning Post, a ship carrying one million barrels of Niger crude left the port of Sémé, Benin, on the 19th and set course for China. The success of this crude cannot go without Chinese influence and China's "ever-improving mediation skills."


Relations between Benin and its landlocked neighbor, Niger, have been in a state of tension since Niger's military coup in July last year.


Niger-Benin crude oil pipeline under construction Photo: Beijing Daily

Following the military coup, the Economic Community of West African States (ECOWAS, WAC) imposed harsh sanctions on Niger, prompting Benin to close its border with Niger. In February this year, after the announcement of Niger's withdrawal from the Economic Community of West African States (ECOWAS, WAC), the WAC lifted some of the sanctions against Niger and Benin reopened its border with Niger. But Niger refused to reopen its land border to goods from Benin, accusing it of being a "training base for terrorists." In response, on May 8, Benin denied Niger the use of its ports for oil exports.


Benin's embargo on Niger's oil exports has affected the Niger government's crude oil marketing project with the China National Petroleum Corporation (CNPC).


On May 15, a Chinese delegation, including CNPC, reportedly held talks with Benin President Patrice Talon.


Benin's Energy Minister Adambi said Benin has no intention of undermining Niger's interests or those of our common partner, the China National Petroleum Corporation (CNPC).


According to the minister, the Chinese delegation requested a meeting of the Benin-Niger Interstate Commission to resolve the dispute between the two countries.


Reports indicate that the opening of the port after four days marks a temporary easing of the trade dispute between the African neighbors and is the latest development in the Chinese government's efforts to mediate disputes on the continent.


Some observers see the quick resolution as a sign of China's economic and diplomatic clout in both countries and Beijing's growing capabilities as a mediator, able to protect Chinese investments in volatile environments.

"The Chinese government has acquired the capacity and expertise to use these good offices to protect Chinese interests in highly volatile situations," Paul Nantulya, an expert at the Africa Centre for Strategic Studies (ACSS), a Washington think tank, told the South China Morning Post.


He said China was close to the ousted Niger government (Bazoum's) and is now close to the coup government. "It has been said that if the coup government were to be overthrown again, it is certain that China would find ways to build strong relations with whoever comes to power."


According to reports, the Niger-Benin pipeline built by China National Petroleum Corporation (CNPC) has officially been in operation since March 1. The entire pipeline has a length of more than 1,000 kilometers in Niger and about 700 kilometers in Benin. It is expected to produce 90,000 barrels of oil per day. Benin receives transit fees and taxes calculated based on export volumes.


Mark Bohlund, credit research analyst at REDD Intelligence, a leading provider of breaking news and special situation analysis based on emerging market events, believes the pipeline gives China leverage over both governments.


"The rapid resolution of this event largely reflects the revenue dependence of both governments on the pipeline." Bohlund said the pipeline is a key lever in Benin's push to open its borders, important not only for Benin's ports and transportation sector, but also for the import of agricultural and food products from Niger.


CNPC entered the Niger market in 2003 and has four ongoing investment projects, including Agadem, Bilma, the Niger-Benin crude oil export pipeline, and the Zinder refinery.


The first-phase oil field capacity and refinery processing capacity is 1 million tons; the second-phase oil field capacity is 4.5 million tons; the crude oil export pipeline is 1,980 kilometers; and the complete industrial chain of upstream and downstream integration has been initially built.China Petroleum News pointed out that the Niger Phase II integration project extends to Niger and Benin and is a key project of the "Belt and Road" and a key project of the Group's "14th Five-Year Plan."






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