IV 
109TH CONGRESS 
1ST SESSION 
H. RES. 344 
Expressing the sense of the House of Representatives that a Chinese state- 
owned energy company exercising control of critical United States energy 
infrastructure and energy production capacity could take action that 
would threaten to impair the national security of the United States. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 29, 2005 
Mr. POMBO (for himself, Mr. OXLEY, Mr. HUNTER, Mr. BARTON of Texas, 
Mr. NEY, and Mr. HYDE) submitted the following resolution; which was 
referred to the Committee on Financial Services, and in addition to the 
Committee on International Relations, for a period to be subsequently de-
termined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
RESOLUTION 
Expressing the sense of the House of Representatives that 
a Chinese state-owned energy company exercising control 
of critical United States energy infrastructure and energy 
production capacity could take action that would threaten 
to impair the national security of the United States. 
Whereas oil and natural gas resources are strategic assets 
critical to national security and the Nation’s economic 
prosperity; 
Whereas the global demand for oil and natural gas is at the 
highest levels in history;
•HRES 344 IH 
Whereas the global excess capacity of oil production, at be-
tween 1,500,000 and 2,000,000 barrels per day, is at its 
lowest level in the past several decades, contributing to 
world oil prices reaching historic highs of above $60 per 
barrel; 
Whereas natural gas globally is the fastest growing compo-
nent of primary energy consumption, projected to in-
crease by nearly 70 percent by 2025; 
Whereas the National Security Strategy of the United States 
approved by President George W. Bush on September 17, 
2002, concludes that the People’s Republic of China re-
mains strongly committed to national one-party rule by 
the Communist Party; 
Whereas China’s daily consumption of crude oil grew by near-
ly 850,000 barrels in 2004, accounting for more than 
one-third of the increase in world demand for oil in 2004; 
Whereas China’s consumption of crude oil is expected to grow 
by an additional 7.5 percent in 2005, and world oil prices 
are projected to rise significantly as a result of increasing 
demand from China for oil; 
Whereas notwithstanding the increasing demand from China 
for oil, domestic Chinese output of oil has remained rel-
atively stagnant; 
Whereas on June 23, 2005, the China National Offshore Oil 
Corporation (CNOOC) announced its intent to acquire 
Unocal Corporation, in the face of a competing bid for 
Unocal Corporation from Chevron Corporation; 
Whereas the People’s Republic of China owns approximately 
70 percent of CNOOC;
•HRES 344 IH 
Whereas a significant portion of the CNOOC acquisition is 
to be financed and heavily subsidized by banks owned by 
the People’s Republic of China; 
Whereas Unocal Corporation is based in the United States, 
and has approximately 1,750,000,000 barrels of oil equiv-
alent, with its core operating areas in Southeast Asia, 
Alaska, Canada, and the lower 48 States; 
Whereas CNOOC has made various representations about its 
intention to sell oil developed in the Gulf of Mexico to the 
United States, but has not made any commitment to sell 
other natural gas and oil it develops into global energy 
markets instead of shipping it directly to China; 
Whereas a CNOOC acquisition of Unocal Corporation would 
result in the strategic assets of Unocal Corporation being 
preferentially allocated to China by the Chinese Govern-
ment; 
Whereas a Chinese Government acquisition of Unocal Cor-
poration would weaken the ability of the United States 
to influence the oil and gas supplies of the Nation 
through companies that must adhere to United States 
laws; 
Whereas Unocal Corporation was responsible for the produc-
tion of energy equivalent to approximately 411,000 bar-
rels of oil per day in 2004, which is approximately one- 
third of all global excess oil production capacity; 
Whereas CNOOC’s control of Unocal Corporation’s produc-
tive capacity would mean control of approximately one- 
third of all global excess oil production capacity; 
Whereas the petroleum sector uses a range of sensitive tech-
nologies for exploration (such as seismic analysis and 
processing, downhole logging sensors, and modeling soft-
•HRES 344 IH 
ware), production, and refining (such as processing tech-
nologies and equipment), including technologies that have 
‘‘dual-use’’ commercial and military applications; 
Whereas several of the technologies used in oil and energy 
production require export licensing for export from the 
United States to China; 
Whereas the CNOOC acquisition of Unocal Corporation could 
provide access to Unocal Corporation’s sensitive dual-use 
technologies that the United States would otherwise re-
strict for export to China; 
Whereas oil companies owned by the People’s Republic of 
China are active in parts of the world, such as Sudan 
and Iran, that are subject to United States sanctions 
laws, and the national security of the United States is 
threatened by the export of sensitive, export controlled, 
and dual-use technologies to such countries; 
Whereas barriers to the ability of the United States Govern-
ment to enforce export controls and sanctions could pose 
a direct threat to the national security of the United 
States; and 
Whereas section 721 of the Defense Production Act of 1950 
(50 App. U.S.C. 2170) authorizes the President to sus-
pend or prohibit any foreign acquisition, merger, or take-
over of a United States corporation that threatens the 
national security of the United States, if the President 
finds that ‘‘there is credible evidence that leads the Presi-
dent to believe that the foreign interest exercising control 
might take action that threatens to impair the national 
security’’ and other provisions of law ‘‘do not in the 
President’s judgment provide adequate and appropriate
•HRES 344 IH 
authority for the President to protect the national secu-
rity’’: Now, therefore, be it 
Resolved, That it is the sense of the House of Rep-
resentatives that— 
(1) the Chinese state-owned China National 
Offshore Oil Corporation, through control of Unocal 
Corporation obtained by the proposed acquisition, 
merger, or takeover of Unocal Corporation, could 
take action that would threaten to impair the na-
tional security of the United States; and 
(2) if Unocal Corporation enters into an agree-
ment of acquisition, merger, or takeover of Unocal 
Corporation by the China National Offshore Oil Cor-
poration, the President should initiate immediately a 
thorough review of the proposed acquisition, merger, 
or takeover. 
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