Faced with political opposition to Canada’s oil sands in the U.S., the Conservative government is determined to ensure energy producers can access British Columbia ports to diversify the country’s export market to Asia.
Natural Resources Minister Joe Oliver was in California on Tuesday for a meeting of Asia-Pacific energy ministers, and was eager to assure potential customers from Asia that Canada is keen to expand energy trade with them, regardless of whether the Washington approves the controversial Keystone XL pipeline.
In a conference call, Mr. Oliver noted that Canada remains dependent on the U.S. as a market for energy exports, and that it is important to expand sales to other, faster-growing markets.
“The overarching strategic need to diversify our energy customers is an important issue for this government,” Mr. Oliver said.
He noted that 97 per cent of Canadian energy exports go to the U.S. “And we would like to diversify that,” he said.
However, the minister could offer no assurances to potential Asian customers that Canada will be able to construct the pipelines and other infrastructure necessary to dramatically increase oil and natural gas sales to Asia.
A joint review panel of the National Energy Board and the Canadian Environmental Assessment Agency is reviewing Enbridge Inc.’s proposed Northern Gateway pipeline, which would deliver 500,000 barrels a day of crude to Kitimat.
The energy board is also reviewing a proposal to ship natural gas to Kitimat in order to liquefy and export it to Asia.
Mr. Oliver said the government would not interfere with the regulatory process.
While in California, the minister is looking to counterbalance the high-profile criticism of Canada’s oil sands and efforts to limit the expansion of American imports from Alberta on environmental grounds.
He said Ottawa remains cautiously optimistic that Washington will approve TransCanada Corp.’s $7-billion Keystone XL pipeline, despite high-profile opposition to the project.
Mr. Oliver also met with California officials who implemented the state’s low-carbon fuel standard, which imposes new barriers on oil sands imports due to concerns about greenhouse gas emissions. The standard took effect this year, and Mr. Oliver apparently had no success in lobbying for changes.
Canada has long complained that the California standard discriminates against Alberta producers compared to other sources of heavy oil, including the state’s own thermally-produced crude. The federal and provincial governments also worry that California’s standard will be copied by other states and jurisdictions like the European Union.
“Our point is that it is important that regulatory standards be based on sound science, to be fair and non-discriminatory and to be consistent with international trade agreements,” he said.