AGW hysteria in U.S. a boon to China, India

“Canada, faced with growing political pressure over the extraction of oil from its … tar sands, has begun courting China and other Asian countries to exploit the resource.

The move comes as American firms are turning away from tar sands because of its heavy carbon footprint …

Whole Foods, the high-end organic grocery chain, and retailer Bed Bath & Beyond last week both signed up to a campaign by ForestEthics to stop US firms using oil from Canadian tar sands. The Pentagon is also scaling down its use of tar sands oil to meet a 2007 law requiring the US government to source fuels with lower greenhouse gas emissions.

Major oil companies such as Shell are also coming under shareholder pressure to pull out of the Canadian projects. Earlier this year, Shell announced it was scaling back its expansion plans for the tar sands after a revolt by shareholders.

In the most significant deal to date, the Canadian government recently approved a C$1.9bn (£1.5bn) investment giving the Chinese state-owned oil company Petro­China a majority share in two projects.  … China’s growing investment in the tar sands is seen in Canada as a useful counter to waning demand for tar sands oil from the US, its biggest customer.  …

Canada is the biggest source of US oil imports, with 65% of tar sands production going to refineries in the midwest. “[US] Companies have been hitting the pause button on projects,” said Simon Dyer, of the Pembina Institute oil sands watch project.

But not China. PetroChina has taken a 60% stake in two new tar sands projects due to get under way in the MacKay River and Dover areas next year, with plans to produce up to 35,000 barrels a day by 2014, and eventually up to 500,000 a day.  …

But [Peter Tertzakian, chief energy economist at ARC Financial Corporation, an energy-focused private equity firm in Calgary, Alberta] said the move by China could also represent the beginnings of a major shift in control of the tar sands.  …

Japanese and South Korean companies have also begun moving in, opening up potential new markets for Canada …  India’s Reliance Industries is also reportedly bidding on a project.”  “Canada looks to China to exploit oil sands rejected by US


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