The oil rush has come to western Canada, with the US and China jockeying for position in what is potentially the world's biggest source of petroleum, known as the Alberta oil sands.
The potential of the oil sands has been known for decades, but with energy prices soaring and heightened fears of a global supply crunch, a growing number of producers from around the world are stepping up efforts to find ways to explore and extract oil.
The oil sands -- deposits of bitumen, a heavy black viscous oil that needs extensive treatment to be converted into an upgraded crude oil -- contain 175 billion barrels of "proven reserves," the largest in the world outside Saudi Arabia.
For an oil-hungry world, the Alberta sands represents the best opportunity for boosting supplies, some analysts say.
"Can you name me another country in the world that can increase its oil production right now?" asks Greg Stringham, vice president at the Canadian Association of Petroleum Producers.
High Costs
Extracting oil from the sands costs as much as US$12 per barrel, making it more costly than crude from other sources. But industry officials say a market price of more than US$25 a barrel will allow oil from the sands to be profitable.
Canada's total oil production is about 2.5 million barrels per day, of which 80 percent is exported to refineries in the US. Canada supplies about 16 percent of US exports, and 10 percent of all US petroleum.
As producers find new ways to extract and treat the bitumen, Canada could diversify its exports -- and China is among the countries in line.
China's interest in Canada's oil is seen as one of the reasons for the visit of President Hu Jintao (
Industry officials say Canada is likely to boost oil production to about 4 million barrels a day, thus providing an extra 1.5 million barrels to a global economy thirsty for more oil.
Chinese oil firms as well as others, including France's Total SA, are seeking partnerships with their Canadian counterparts as they bid for rights to sands -- found in an area of 140,800km2 of primarily northern Alberta.
Pacific pipeline
PetroChina is in talks with Canada's Enbridge meanwhile on the construction of a pipeline that would transport some 400,000 barrels per day from Fort McMurray, Alberta, to the Pacific coast, for an estimated cost of US$2.5 billion (US$2 billion).
Jiang Wenran (姜聞然), a political scientist at the University of Alberta, said China and Canada have mutual interests in cooperating in the oil sands exploitation. Both however are aware that China's ownership of a strategic asset is a politically sensitivity topic.
"All the major oil companies of China have offices in Calgary but they keep a very low profile," Jiang said. "They are aware of the Canadian debate about strategic and national security implications and they don't want to provoke anything so there are working in a discreet manner."
The US does not want to be left out of the action either. US Treasury Secretary John Snow recently visited the oil sands area, with Vice President Dick Cheney scheduled to follow.
"Now, the world is finally caught on to the fact that yes, these are actually developable," Alberta's Energy Minister Greg Melchin said. "It's a track everybody is interested in, including the United States."
"The United States has clearly begun to see this picture," said Sherry Burns, chief economist at BMO Nesbitt Burns.
"The global geopolitical implications are very important. Canada's role in the global economy and in the political sphere is about to increase dramatically in importance. It's nice to have a world-class bounty that the two largest economic powers desperately need," Burns said.
The CIA has a message for Chinese government officials worried about their place in Chinese President Xi Jinping’s (習近平) government: Come work with us. The agency released two Mandarin-language videos on social media on Thursday inviting disgruntled officials to contact the CIA. The recruitment videos posted on YouTube and X racked up more than 5 million views combined in their first day. The outreach comes as CIA Director John Ratcliffe has vowed to boost the agency’s use of intelligence from human sources and its focus on China, which has recently targeted US officials with its own espionage operations. The videos are “aimed at
STEADFAST FRIEND: The bills encourage increased Taiwan-US engagement and address China’s distortion of UN Resolution 2758 to isolate Taiwan internationally The Presidential Office yesterday thanked the US House of Representatives for unanimously passing two Taiwan-related bills highlighting its solid support for Taiwan’s democracy and global participation, and for deepening bilateral relations. One of the bills, the Taiwan Assurance Implementation Act, requires the US Department of State to periodically review its guidelines for engagement with Taiwan, and report to the US Congress on the guidelines and plans to lift self-imposed limitations on US-Taiwan engagement. The other bill is the Taiwan International Solidarity Act, which clarifies that UN Resolution 2758 does not address the issue of the representation of Taiwan or its people in
US Indo-Pacific Commander Admiral Samuel Paparo on Friday expressed concern over the rate at which China is diversifying its military exercises, the Financial Times (FT) reported on Saturday. “The rates of change on the depth and breadth of their exercises is the one non-linear effect that I’ve seen in the last year that wakes me up at night or keeps me up at night,” Paparo was quoted by FT as saying while attending the annual Sedona Forum at the McCain Institute in Arizona. Paparo also expressed concern over the speed with which China was expanding its military. While the US
SHIFT: Taiwan’s better-than-expected first-quarter GDP and signs of weakness in the US have driven global capital back to emerging markets, the central bank head said The central bank yesterday blamed market speculation for the steep rise in the local currency, and urged exporters and financial institutions to stay calm and stop panic sell-offs to avoid hurting their own profitability. The nation’s top monetary policymaker said that it would step in, if necessary, to maintain order and stability in the foreign exchange market. The remarks came as the NT dollar yesterday closed up NT$0.919 to NT$30.145 against the US dollar in Taipei trading, after rising as high as NT$29.59 in intraday trading. The local currency has surged 5.85 percent against the greenback over the past two sessions, central
RSS