Oil exports to top agenda of Canadian PM's China visit

Increasing oil exports to China will be high on the agenda of Canadian Prime Minister Stephen Harper's upcoming visit to China next week, which will hopefully improve both countries energy security, analysts said.

Harper will make an official visit to China from Feb 7 to 11, Foreign Ministry spokesman Liu Weimin said on Tuesday.

Energy and resources will be high on the agenda of Harper's visit, China's Ambassador to Canada Zhang Junsai said in an interview with The Canadian Press.

Disappointed with US President Barack Obama's rejection of an oil pipeline project, Canada is seeking to export more oil to China to meet the need for the two countries to diversify their energy export destinations and sources and improve energy security, said Xia Yishan, a senior expert on energy strategies and researcher with the China Institute of International Studies.

According to The Associated Press, several hundred people gathered for hearings in January on whether a pipeline should be laid from the Alberta oil sands to the Pacific in order to deliver oil to Asia, chiefly China.

The Northern Gateway Pipeline, which may end at Kitamaat Village on the British Columbia coast in Canada, would be built to handle 220 tankers a year and 525,000 barrels of oil a day, according to the AP.

Another pipeline that would have gone from Alberta to the Texas coast was blocked by the Obama administration citing environmental grounds, the AP reported.

Harper says he was "profoundly disappointed" that Obama rejected the Texas Keystone XL option but also spoke of the need to diversify Canada's oil industry, the AP reported.

Ninety-seven percent of Canadian oil exports now go to the United States.

"I think what's happened around the Keystone is a wake-up call, the degree to which we are dependent or possibly held hostage to decisions in the United States, and especially decisions that may be made for very bad political reasons," Harper told Canadian TV.

US Republican presidential candidate Newt Gingrich quickly picked up the theme, saying that Harper, "who, by the way, is conservative and pro-American ... has said he's going cut a deal with the Chinese ... We'll get none of the jobs, none of the energy, none of the opportunity".

Gingrich said "an American president who can create a Chinese-Canadian partnership is truly a danger to this country".

Xia said Canada is attracted by China's large demand for oil and promising prospects in the Chinese oil market.

"China is undergoing rapid industrialization and urbanization, and its demand for energy and resources is huge. Canada, on the other hand, is rich in energy and resources, and has a stable political situation as well as favorable conditions for investment," Ambassador Zhang said.

"The two countries have every reason to forge a stable and win-win partnership in the long run in the field of resources," Zhang said.

Increasing energy cooperation with Canada will open another channel for China's oil sources in addition to OPEC countries, said Xia.

According to the Wall Street Journal, Canada's Athabasca Oil Sands Corp said in early January that it was selling a 40 percent stake in one of its oil-sands prospects to PetroChina, a move that for the first time will give full ownership of such a project to a Chinese company.

Xia said Obama's objection to Canada's oil pipeline project pushed Canada to turn to China for more cooperation, which will also benefit the US.

"Guaranteeing China's energy security will ensure its economic development, from which the US, as an important trade partner with China, will likely have more exports to China," Xia said.

"Any US politician will welcome China-Canada energy cooperation if they consider the general picture," Xia said.