Canada plan to sell oil to China faces hurdles
Political problems, lack of pipeline hamper effort following US snub as Harper heads for Beijing this week
Ottawa: Prime Minister Stephen Harper may still be smarting from Canada's failed bid to ramp up oil exports to the United States, but his plan B could prove to be even tougher.
Harper heads across the Pacific this week in a bid to convince China to satisfy its growing energy appetite with Canada's vast oil reserves.
Though it appears a classic supply-demand match on the surface, the plan faces hurdles that range from how long it will take to build the pipeline to environmental dangers and questions about China's human rights record.
China imports no oil from Canada at present, and the infrastructure is not in place in Canada to get the crude from the massive tar sands of Alberta to the Pacific coast, forcing a long-term view of a partnership.
"China as an energy market directly for the delivery of [Canadian] oil is medium to long term. Five years is too short, ten years is perhaps doable," said Gordon Houlden, a former Canadian diplomat with extensive Chinese experience who heads the University of Alberta's China Institute.
A myriad of legal and regulatory issues play a big role in the delay.
The most obvious supply route for crude headed to China is pipeline operator Enbridge Inc's proposed 1,177 kilometre Northern Gateway pipeline from the northern Alberta oil sands to Kitimat on the British Columbia coast, which is strongly opposed by greens and some aboriginal bands.
Regulatory hearings into the pipeline opened last month and could drag on for years, after which the project looks set to meander through Canada's slow-paced court system.
"The challenge of exporting energy from Canada to China is a domestic challenge... so I would not place any false hopes on the China visit with respect to a breakthrough on the energy file," said Yuen Pau Woo, president of the Asia Pacific Foundation of Canada.
Harper nevertheless says he is serious about diversifying the market for oil exports after US President Barack Obama last month vetoed TransCanada Corp's Keystone XL pipeline that would have carried crude from Alberta to Texas refineries.
The Keystone pipeline is a hot political issue in the United States, where the Republicans are choosing a presidential candidate to run against Obama in the November 2012 election.
