Harper's oil sands plan puzzles industry, greens

Fri Sep 26, 2008 5:27pm EDT
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By Jeffrey Jones

CALGARY, Alberta (Reuters) - Prime Minister Stephen Harper said on Friday he would ban exports of tar-like bitumen from Alberta's oil sands to countries that do not match Canadian efforts to cut carbon emissions, a campaign promise that perplexed both the oil industry and environmentalists.

The policy could affect Asian countries that are the target of a proposed Enbridge Inc pipeline that would move oil sands-derived crude to Canada's West Coast to be shipped across the Pacific Ocean by tanker, Harper said.

He announced the move at a campaign stop ahead of the October 14 general election as a away to prevent companies from avoiding Canadian emission standards, he said.

Asked by reporters if it could affect future bitumen exports to Asia, he said: "Well, it could, it absolutely could."

The ban would not affect existing contracts, all of which involve supply agreements with U.S. refineries, he said.

Enbridge's planned $4.2 billion Gateway line would take 400,000 barrels a day of oil sands crude. The initiative is being driven by interest from refineries in such countries as Singapore and Japan, the company has said.

Harper's plan surprised Enbridge, and the firm has yet to determine its impact, spokesman Steven Greenaway said.

The Canadian Association of Petroleum Producers, the oil industry's main lobby group, said it too was still trying to make sense of the ban in the absence of many details.   Continued...

<p>Conservative leader and Canada's Prime Minister Stephen Harper listens to a question during a news conference in Calgary, Alberta September 26, 2008. Canadians will head to the polls in a federal election October 14. REUTERS/Chris Wattie</p>