China is looking to secure its foothold on Canada’s oil sands, an entirely unsurprising development as President Obama continues to ignore North America’s rich energy resources and delay construction of the Keystone XL pipeline. On Monday, China’s state-owned Cnooc offered to buy the Canadian energy company Nexen, a significant player in the oil sands market. The Wall Street Journal editorial page today describes this move as “a post-Keystone XL pipeline bid to replace the U.S. as Canada’s biggest energy investor and market.” China is happily seizing on President Obama’s misguided policies, and if the U.S. doesn’t move quickly to get Keystone XL built, we risk losing access to this important North American energy resource.
The House has now voted to advance the Keystone XL pipeline six times, but Senate Democrats and the president have refused to let this jobs and energy project move forward. Earlier this week, Energy and Commerce Committee member Rep. Lee Terry (R-NE) introduced additional legislation that will remove the president’s authority over the pipeline and allow this shovel-ready project to move forward.
China’s Canadian Energy Play
The Wall Street Journal
July 24, 2012
President Obama may not want to exploit the energy buried in Canada’s Alberta oil sands, but China sure does. Think of Monday’s $15.1 billion offer by China’s state-owned Cnooc to buy Canadian energy giant Nexen as a post-Keystone XL Pipeline bid to replace the U.S. as Canada’s biggest energy investor and market.
Nexen offers Cnooc a sweeping North American energy footprint, with assets from heavy oil and shale gas in Alberta to offshore leases in the Gulf of Mexico. Part of the bet is also on Canadian politics, which could block the investment on nationalist grounds but which so far hasn’t been captured by the anticarbon fevers that dominate Washington.
Canada seems to understand that its resources are a gift that can raise national prosperity. And as extraction technology has improved, Canada’s proven oil reserves have climbed to at least 180 billion barrels, putting it behind only Saudi Arabia and Venezuela. …
Contrast that to the U.S., where President Obama has spent tens of billions on failed green energy schemes while making fossil-fuel exploration harder. This week the White House issued a veto threat against a House bill that would restore pre-Obama plans to allow greater offshore exploration. Alaska oil production is so low that there are worries about the viability of its pipeline. Shell Oil, which has plowed $4.5 billion into an Arctic investment, has been waiting the entire Obama Presidency for permits. The EPA is also waiting for a second term to impose national regulations on shale fracking.
Mr. Obama’s rejection of the $7 billion Keystone XL has no doubt concentrated Chinese and Canadian minds. The pipeline would have moved oil from Canada and North Dakota to refineries on the Gulf Coast, and Mr. Obama’s bow to American greens was a direct snub to Canada, which provides nearly 30% of U.S. imports. Prime Minister Stephen Harper promptly said that Canada needs to diversify its energy markets, perhaps by building a pipeline from Alberta to the West Coast to export to Asia. …
The lesson for America, and especially Democrats, is that Canada’s oil sands will be developed, whether their green financiers like it or not. If the U.S. doesn’t want the oil, China and the rest of Asia will gladly take it. The world wants to grow—must grow to reduce poverty—and it needs abundant, cheap energy to do it. Why is that so hard for some Americans to understand?
Read the full article online HERE.