Foreign direct investment (FDI) affiliates continued to play an important role in the U.S. energy industry in 2001, according to Foreign Direct Investment in U.S. Energy in 2001 from the Energy Information Administration (EIA). This annual publication describes the energy operations, capital investments, and net foreign investment flows of U.S. energy enterprises that are recipients of foreign direct investment. The report also examines patterns of direct investment in foreign energy enterprises by U.S.-based companies.

Oil and Gas

In 2001, FDI affiliates accounted for more than 10 percent of the oil and gas produced in the United States. Two companies, BP America and Shell Oil, together accounted for 95 percent of the oil and 90 percent of the natural gas produced by the FDI affiliates. BP America produced more oil and more gas in the United States than any other company in the United States, whether an FDI affiliate or not.

The FDI affiliates' share of refining capacity decreased slightly in 2001, to 29 percent. The decrease was accounted for entirely by BP America, which sold two refineries to complete planned disposals resulting from the mergers of BP, Amoco, and Atlantic Richfield. FDI affiliates’ share of gasoline sales declined by one percent to reach 34 percent of gasoline sales as total gasoline sales in the United States rose in 2001. The total number of retail outlets for the FDI affiliates fell 4 percent in 2001, and their share of the number of stations fell to 31 percent.

Uranium Mining, Coal, and Electricity

FDI-affiliate companies increased their share of U.S. uranium concentrate (U3O8) production to 92 percent in 2001 as total U3O8 output continued its declining trend of previous years. Cameco (Canada) became the dominant uranium producer in the United States through its U.S. subsidiaries. Domestic coal production by the FDI affiliates increased in 2001, advancing the FDI affiliates' share of U.S. coal production to 27 percent, largely based on production increases by the two largest affiliates. Domestic electricity generation by FDI affiliates fell faster than total U.S. electricity generation in 2001, resulting in a slight decline in the affiliates' share to 2.7 percent.

FDI-Affiliates' Share of U.S. Production, Generation, and Refining Capacity, 1980-2001

Source: Energy Information Administration.

Capital Spending

Capital spending by FDI affiliates in the U.S. petroleum and natural gas industry were $9 billion in 2001, a 47-percent drop from 2000, but still 67 percent above the 1999 level. Total FDI affiliates' expenditures were unusually large in 2000 because of acquisitions by BP Amoco. In 2001, there were no major acquisitions in petroleum and natural gas by foreign direct investors. Upstream capital, exploration, and development expenditures by the FDI affiliates fell 50 percent, to $7.8 billion in 2001, and downstream capital expenditures in petroleum refining increased 29 percent among FDI affiliates that reported in both 2000 and 2001.

Foreign Direct Investment Inflows

Direct investment capital inflows to affiliates of foreign investors in the U.S. energy industry fell sharply in 2001, along with direct capital inflows to the U.S. economy as a whole. FDI inflows to the U.S. petroleum and natural gas industry fell to 23 percent of their 2000 level. FDI inflows to the electric, gas, and sanitary services industry fell 32 percent in 2001. Net inflows to the coal mining and coal mining services industries in the 1994-to-2001 period were -$1.1 billion; that is, there was a net withdrawal of FDI capital by foreign investors. The total net FDI inflows to the other metallic ores mining industries between 1994 and 2001, including uranium concentrate mining production, were $0.3 billion, or 0.03 percent of the total FDI inflows to the United States over the period.

The current edition of Foreign Direct Investment in U.S. Energy analyzes data from 2001. FDI data for 2002 on acquisitions and divestitures of energy companies are expected to be made available on the EIA Web site in late November of this year.

If you are having technical problems with this website, please contact the EIA Webmaster at wmaster@eia.doe.gov or call 202-586-8959. For general information about energy, contact the National Energy Information Center at 202-586-8800 or infoctr@eia.doe.gov.

Questions about the report's content should be directed to:

Larry Spancake, Financial Analysis Team

larry.spancake@eia.doe.gov

Phone: (202) 586-6581

URL: http://www.eia.doe.gov/emeu/plugs/plfdi001.html
File last modified: September 25, 2003