Canada will look to sell oil elsewhere if U.S. balks at Keystone XL

Canada will look to sell oil elsewhere if U.S. balks at Keystone XL: Oliver

richard blackwell

Published Friday, Oct. 28, 2011 4:31PM EDT

If the United States turns it back on increased supplies of Canadian oil by cancelling the Keystone XL pipeline, Canada will look to export more to other countries, particularly in Asia, federal Natural Resources Minister Joe Oliver said Friday.

Mr. Oliver told The Globe and Mail’s editorial board that he does not make this point to U.S. officials “unless they ask,” but “if they don’t want our oil....it is obvious we are going to export it elsewhere.”

China could be a key customer in the future, he said. “As a broad strategic objective we have to diversify our customer base.....[and] China has emerged as the largest consumer of energy in the world, so it is utterly obvious what we must do.”

Mr. Oliver did not specifically endorse the proposed Northern Gateway pipeline, which would carry oil sands petroleum to the west coast, where it would be transported to Asia by tanker, saying he will respect the regulatory process that is now evaluating that project.

Mr. Oliver will soon be travelling to China to participate in a mining conference, and he said he will discuss energy while he is there. “They are hungry for our resources, and I think we will have things to talk about.”

Mr. Oliver has been trying to get his pro-oil sands message out in the U.S., but he said he does not use the argument that Canada produces “ethical oil,” instead emphasizing that Canada is a reliable producer.

If the Keystone XL pipeline does not get approved in its current form “maybe it would be modified, maybe there would be other projects to the United States,” Mr. Oliver said. “In the meantime, we have to look at the potential markets globally.”

Mr. Oliver said he is lobbying furiously to stop a European initiative that would label crude from the oil sands as dirtier than fuel from conventional sources.

The European Commission’s proposed fuel quality directive is “discriminatory” and not based on science, he said.

Mr. Oliver recently made a trip to Europe where he pushed to have the directive changed, and he has sent letters to the EU’s commissioner of energy and all the member states. Copies of the letter will be sent to the 700 members of the European parliament, he said.

The European directive aims to reduce greenhouse gas emissions in the transportation sector by 6 per cent, but Mr. Oliver said Europe current imports very little fuel from Canada. Several countries in Europe support Canada’s position, he said.

Keith Stewart of Greenpeace Canada said Mr. Oliver's attempts to stop the European fuel quality directive is “part of a desperate attempt to block clean energy legislation in other countries.” Mr. Stewart said Greenpeace expects the European Union “to heed the peer-reviewed science confirming that the tar sands are much more polluting than conventional oil and to ignore Minister Oliver's thinly veiled attempt to delay action to reduce the global warming impact of transportation fuels.”