Everywhere you look these days, China is making inroads in its efforts to lock up control of critical energy and energy minerals supplies. From fossil fuels like oil, natural gas, and coal to energy minerals critical to the manufacture of wind turbines, solar arrays and electric vehicles, Xi Jinping’s government has been systematically locking up supplies and control of supply chains in recent years.
Much of China’s efforts in this regard have been facilitated via its Belt and Road Initiative, in which China funds developing nations’ infrastructure via loans and levers the new relationships created to gain advantage in negotiations over contracts to lock up resources for its own use. The results to date are more than impressive.
A recent study published by researchers at S&P Global finds that Chinese companies have won bids for half of all the lithium mines offered for sale around the world since 2018. Note that these are the hard rock lithium mines that have been offered for sale, but lithium is also recovered from brine reserves via an evaporation process. Thus, this report’s findings do not include the deal two Chinese companies negotiated earlier this year with the government of Bolivia that will enable China to control the production and processing of that country’s massive brine lithium resources and the manufacture of EV batteries with it. (RELATED: DAVID BLACKMON: Wind And Solar Keep Failing Texans At The Worst Possible Times)
China has also been able to leverage its geopolitical influence with its fellow members of the increasingly powerful BRICS trade alliance in recent years. Before last week’s annual BRICS Summit, those fellow member nations consisted of Brazil, Russia, India, and South Africa. The vote by those five original BRICS members to more than double the alliance’s membership will now create new opportunities for China to exert even more leverage and influence in its continuing efforts to lock up reserves of these valuable energy mineral resources.
Now, think about the magnitude of mineral resources BRICS will now encompass by adding Saudi Arabia, Iran, the United Arab Emirates, Egypt, Ethiopia and Argentina to its roster of member nations.
The addition of the three Middle Eastern oil powers will mean BRICS controls 42% of global crude oil production per an estimate performed by VisualCapitalist. That compares to the 38% of global crude controlled by OPEC. China had already been entering into multi-billion dollar deals with Saudi Arabia related to production and refining of oil, as well as expanding its influence throughout the Middle East. Now, it will be able to redouble such efforts with these oil powers through the BRICS platform as well.
The addition of Argentina brings with it one of the most notable natural gas shale developments outside the United States. The Vaca Muerta play has struggled to gain critical mass over the last several years, but now appears poised for rapid expansion once a major pipeline project is completed. The country is also home to significant deposits of copper, manganese, and tungsten. (RELATED: SHOSHANA BRYEN: Can The US Turn These Historic Rivals Into Partners?)
It is not all that well-known, but thanks to several major discoveries made by U.S. companies over the last two decades, Egypt currently ranks as the world’s 13th-largest natural gas producer. Its location at the mouth of the Suez Canal constitutes a huge strategic geopolitical asset as well.
Ethiopia is not known to be all that rich in mineral resources, but it also occupies a strategic geographic footprint at the mouth of the Red Sea, through which cargo ships and Middle East oil tankers must traverse to reach the Suez Canal. As we saw in 2021, when this strategic waterway that facilitates so much of the world’s global trade in oil and other commodities was blocked for just a few hours by a huge cargo ship, the loss of that route causes all manner of economic panic and disruptions.
At the end of the day, the expansion of BRICS not only creates what is almost unarguably now the world’s most powerful trade alliance, it also serves to enhance China’s ability to expand its own growing influence across the globe. The implications for the United States and the rest of the western world are hard to overstate, yet the Biden administration has barely uttered a peep about it. Make of that what you will.
David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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