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Canada Visits China to Talk Oil

Now that the U.S. has snubbed one of our greatest allies and trading partners with a silly political delay of an important timeline, Canada is looking for other places where it can sell its oil. We were told ahead of time that this would happen, and now Canada is looking to export its oil to China:

Harper’s own delegation includes a wider business focus, with top executives from Air Canada, SNC-Lavalin and Bombardier, Manulife and Scotiabank.

Foreign Affairs Minister John Baird and Agriculture Minister Gerry Ritz will also visit the country.

The delegation left early Monday afternoon and will be in China from Feb. 8 to 11.

China’s total investment in Canada used to add up to millions of dollars, but since 2009 has increased to up to $20 billion.

It has come with a shift in this country from relying solely on the United States as the only buyer of Canadian oil and gas — something Harper emphasized repeatedly when U.S. President Barack Obama delayed a decision and then denied a permit to TransCanada for its Keystone XL pipeline. The pipeline would have sent oil from Alberta through the U.S. to the coast of Texas.

Peter Harder, president of the Canada-China Business Council and a former top official at the Department of Foreign Affairs, said the United States will always be Canada’s No. 1 trading partner, but China will be No. 2.

“And the question is how big that No. 2 will be,” he said.

There is, of course, nothing wrong with Canada exporting oil to China. China needs oil just as much as the United States does. However, we had an opportunity to refine that oil within the United States, keep some for ourselves, and export the rest. If we continue to stall and send mix signals regarding the Keystone Pipeline, its likely that Canada will try exporting it directly to China, bypassing the U.S. altogether.

Joe Nocera at The New York Times gets it:

I realize that President Obama rejected Keystone because, politically, he had no choice.  My guess is that, in his centrist heart of hearts, the president wanted to approve it.  But to give the go-ahead before the election was to risk losing the support of the environmentalists who make up an important part of his base.

I also understand that the Republican decision to force Obama’s hand was a political stunt, allowing them to denounce his decision during the campaign.  As Jennifer Steinhauer put it in The Times recently, “Republicans are framing Keystone as an urgent jobs and energy project at a time of high unemployment and creeping gasoline prices.”

Surely, though, what the Keystone decision really represents is the way our poisoned politics damages the country.  Environmental concerns notwithstanding, America will be using oil — and lots of it — for the foreseeable future. It is the fundamental means by which we transport ourselves, whether by air, car or truck. Where do we get that oil? Mostly from countries that don’t like us, like Venezuela, which has the world’s second-largest oil reserves.

And here is Canada, a staunch American ally that has historically sold us virtually all of its crude exports.  Over the past two decades, energy companies have invested tens of billions of dollars in the tar sands, so much so that Canada now ranks No. 3 in estimated oil reserves. Along with the natural gas that can now be extracted thanks to hydraulic fracturing — which, of course, all right-thinking environmentalists also oppose — the oil from the Canadian tar sands ought to be viewed as a great gift that has been handed to North America.  These two relatively new sources of fossil fuels offer America its first real chance in decades to become, if not energy self-sufficient, at least energy secure, no longer beholden to OPEC.   Yet these gifts have been transformed, like everything else, into political footballs.

And though you may describe Republican’s insistence on building the pipeline as a political “stunt,” that stunt would go away — immediately — if President Obama would approve the pipeline.

 

 

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