Resource Nationalism - Limits to Foreign Direct Investment

Gavin L. Kretzschmar, Axel Kirchner and Liliya Sharifzyanova

The Energy Journal, 2010, vol. 31, issue 2, 27-52

Abstract: Despite a global trend toward the privatization of state assets, host governments are consolidating ownership over strategically important domestic oil and gas resources, effectively limiting corporate foreign direct investment. These findings are supported by an analysis of global reserve acquisitions for the period 2000-2006, a period which saw listed national oil companies (NOCs) acquire over 82% of their reserves domestically, compared to only 25% for commercial operators. We also perform a regression analysis and find that political risk and reserve size are strongly related to state ownership retention, while the degree of state control is positively related to OPEC membership. Foreign direct investment is shown to be increasingly constrained to assets in low-risk developed countries or marginal oilfield assets.

Keywords: Resource nationalism; Foreign direct investment; Oil and gas resources; State companies (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:enejou:v:31:y:2010:i:2:p:27-52

DOI: 10.5547/ISSN0195-6574-EJ-Vol31-No2-2

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