The problem with stealing so much private property (for Russia and Venezuela anyways) is that no one is particularly interested in putting much capital in your hands for the development of expensive energy projects. Hence the Chinese swoop in with very disadvantageous offers (I have seen estimates that the $25 billion offer to the Russians works out to something like $20 a barrel). This bit comes from the Economist:
China also announced no fewer than three agreements with state-controlled companies–a $25 billion deal with Russia’s Rosneft and Transneft, a $10 billion deal with Brazil’s Petrobras and a $4 billion deal with PDVSA of Venezuela. Details differ a bit in each transaction but the broad thrust is the same. Brazil has discovered a spectacular oil field off its cost, but it will be hard and expensive to exploit. Russia wants to complete a costly pipeline to China. Venezuela is a mess. Each, for whatever reason, needs money and the usual sources have dried up.
In all these cases, China’s financial resources should be welcome,but because the ends are not purely commercial, money is only one facetof a complex equation. Australia puts every foreign investment before areview board, and it is deeply concerned about China, which may notoperate as a typical commercial investor trying to maximise the valueof a resource, but rather as the representative of buyers who wouldlike to do the reverse. It is in Australia’s national interest for itsresources to be highly valued; it is in China’s national interest tofind low-cost resources to feed its mills and factories. Any approvalwill be laden with conditions.
Deals with sovereign governments face fewer obstacles because sellerand regulator are one and the same, but sticking points remain. One ofthe reasons Russia and Venezuela have turned to China is that otherforms of capital are no longer available to them, not only because ofthe financial crisis, but because of their own recent expropriations ofprevious investments by Exxon, ConocoPhillips, and Statoil (inVenezuela’s case) and BP and Shell (in Russia’s). “There is no absoluteproperty right for a private company in natural resources becausecountries claim economic sovereignty, and the right to disposes,”observes George Joffe, a professor at Cambridge University.