There is “imminent and pent up” interest for Alberta oil and natural gas in Asia where countries want to diversify their energy imports, says the province’s energy minister who is wrapping up a trip to Japan, China and South Korea.
“Thanks to our Climate Leadership Plan, we are closer than ever to diversifying our export markets to Canadian tidewater,” Marg McCuaig-Boyd said on Thursday in a conference call from Seoul, South Korea. She and other government officials on Friday will wrap up 10 days of meetings which included a focus on diversifying Alberta energy markets.
“This is a critical time for our efforts in the Asia-Pacific Basin which is the world’s largest and fastest-growing energy consuming region and a major force of international investment.”
Kinder Morgan Canada’s Trans Mountain expansion, which will take Canadian crude oil off the West Coast of Canada, is seen as a “game changer,” by Asian countries, she said. Officials in Japan where the trip began were pleased to hear about progress on the project which is critical to Alberta and Japan’s mutual interest in diversification of markets and supply, she said.
The pipeline, which has federal government approval, will substantially cut shipping costs with a 16 to 17-day trip from the Pacific Coast of Canada compared to more than 50 days from some other countries and should result in better prices for the resource, McCuaig-Boyd noted.
“I would expect that they [producers] can get good contracts with them because they know it is going to take less time to ship product so that’s an advantage for Alberta.”
In China’s Sichuan province, McCuaig-Boyd was joined by representatives of Suncor Energy, MEG Energy and Encana at a meeting with her provincial counterpart, the Sichuan minister of energy. The Alberta minister also met with Sichuan’s ministers of land and resources and foreign affairs.
“As one of China’s leading oil and gas producing jurisdictions, Sichuan officials were eager to learn about Alberta’s Climate Leadership Plan and how we are taking action to reduce emissions while ensuring our industry is competitive in an era of stubbornly low oil prices,” said McCuaig-Boyd.
There still are opportunities for Asian companies to invest in the Alberta oilsands and while it will be a new market for some companies, “it’s a market that will be good for us.”
“The value of dialogue between Canada and China in the energy sector has never been greater as we face unpredictable and rapid change,” she said. “It was clear from our meetings that Alberta and China’s interests are more interlinked than ever before.”
Alberta officials also will have a busy three days of meetings in South Korea with leaders in the oil and gas, renewable and clean tech sectors. McCuaig-Boyd said she heard considerable interest in Alberta’s renewable energy program and she shared information on potential investment opportunities in other sectors of the Climate Leadership Plan, including micro-generation.
The Alberta delegation will conclude its visit Friday by touring Korea Gas Corporation’s LNG terminal and discussing their mutual interest in diversifying Alberta gas exports and Korean imports.
“Overall, Korea’s oil and gas priorities are very similar to Japan’s,” she said. “They need to import everything they use because they don’t have enough energy resources of their own and are eager to diversify their supplies beyond the Middle East and Alberta is ‘the perfect match’ as one executive told me.”
Asian countries, including China, are taking action to reduce their greenhouse gas emissions and to protect their air and water, said McCuaig-Boyd. “There is simply no going back to a time when we ignored these issues,” she said. “Countries that do so will only watch their global competitiveness slip and do irreparable damage to the environment that could save their economies and way of life.”
Alberta’s Climate Leadership Plan was recognized as a major investment opportunity in Asia with companies from all three countries eager to explore opportunities related to the province’s phase-out of coal and its shift to natural gas and renewables, said McCuaig-Boyd. “At the same time, they are keen to grow their investments in our traditional hydrocarbon sector as a way to diversify their imports with a stable trusted partner amid increasingly geopolitical risk and uncertainty.”