Analysis: Canada plan to sell oil to China faces big hurdles
By David Ljunggren
OTTAWA (Reuters) - 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 next 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, 10 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-km (731-mile) 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 meander through Canada's slow-paced court system. Continued...