Canada is assuring Chinese officials that the nation is welcome to expand investments in Canada’s oil industry
BEIJING — Canadian Natural Resource Minister Joe Oliver, who is accompanying Prime Minister Stephen Harper on a four-day visit to China, said he’s assuring Chinese officials that the nation is welcome to expand investments in Canada’s oil industry.
Harper led a delegation of more than 40 business executives and five ministers to deepen energy links with the Asian country and reduce Canada’s reliance on the United States after President Obama rejected TransCanada’s $7 billion Keystone XL pipeline to ship Canadian oil to the Gulf Coast. Canada, which sits on the world’s third-largest oil reserves, sends 99 percent of its oil exports to the United States.
There is fierce environmental and aboriginal opposition to the Pacific pipeline, but Harper’s government has called it a nation-building project that is crucial to the country’s goal of becoming an energy super power.
Canada doesn’t have sufficient capital to fully develop its oil reserves, Oliver said, adding the key factor in government approval will be whether investments are being made for “commercial” purposes.
“As their investments get larger, they are watching to see whether we continue to be welcoming. We’ve told them we are welcoming,” Oliver said. “Our oil sands are the largest energy project in the entire world. We simply don’t have enough capital in Canada.”
While all major foreign investments in Canada require government approval, there is additional scrutiny for acquisitions by foreign state-owned companies. Oliver said Chinese officials raised foreign-ownership issues in Canada during the trip.
“What’s important is that they act as good corporate citizens, they act on a commercial basis, and they have been,” Oliver said on a flight from Guangzhou to Chongqing, the last stop of Harper’s tour.
Harper, meanwhile, is gaining support among Canadians for his plan to ship oil and crude to China after Obama’s decision.
Efforts to boost support for selling oil to China may be having an impact. Opposition to the Northern Gateway pipeline has weakened in recent weeks, according to a survey by Toronto-based Forum Research. The pipeline would let crude flow to Asia from Alberta’s oil sands via a Canadian port in British Columbia.
Sinopec, a Chinese state-controlled oil company, has a stake in Enbridge’s proposed $5.5 billion pipeline. Chinese state-owned companies also have invested more than $16 billion in the oil sands in the past two years.
Harper is pushing energy exports to Asia to reduce the country’s reliance on the United States and make Canada a global energy “superpower.”
Tapping markets in Asia may raise the price received by Canadian producers by $13.60 a barrel by 2030, according to a University of Calgary study.
Harper expressed his “profound disappointment” Jan. 19 after the United States rejected Keystone, telling Obama that Canada will “continue to work to diversify its energy exports,” according to details provided by Harper’s office.
Public environmental hearings into the Northern Gateway pipeline were held last month in Kitimaat Village, an aboriginal community on British Columbia’s Pacific Coast that would overlook Enbridge’s proposed tanker facility.
The proposed pipeline would take oil to the nearby city of Kitimat, B.C., where tankers would transport the oil to China. Opponents fear pipeline leaks and a potential Exxon Valdez-like disaster on the pristine Pacific Coast. About 220 oil tankers a year would visit Kitimat’s port.
The seas nearby, in the Douglas Channel, “are very treacherous waters,” says David Suzuki, a leading environmentalist. “You take a supertanker that takes miles in order to stop, (and) an accident is absolutely inevitable.”
Source: http://seattletimes.nwsource.com/html/nationworld/2017493698_chinacanada13.html?syndication=rss
