Ahead of pipeline ruling, Canada says it wants Asia exports

By David Ljunggren

OTTAWA (Reuters) - Canada's natural resources minister said on Tuesday it was important that Canadian oil exports reach Asia, as the Liberal government prepares to decide whether to approve Kinder Morgan Inc's plans to more than double the capacity of a pipeline to the Pacific.

Ottawa must decide by Dec. 19 on the company's proposal to build a second pipeline adjacent to the existing Trans Mountain line from the Alberta oil sands to the west coast, where the oil could be loaded on tankers and shipped to lucrative Asian refining markets.

Environmentalists and aboriginal activists strongly oppose the project and have reacted angrily to what they have said were indications the Liberals would approve it.

 

Oil companies seeking relief from transport bottlenecks could be helped if U.S. President-elect Donald Trump fulfils a promise to give a permit for TransCanada Corp's Keystone XL pipeline from Alberta to Texas.

But when pressed on a possible Keystone approval, Natural Resources Minister Jim Carr told reporters: "It doesn't get oil to export markets in Asia, and it's a goal of the government of Canada to expand its export markets."

Kinder Morgan Canada President Ian Anderson, asked about Carr's comments, told reporters in Kamloops, British Columbia, that they were "consistent with what producers have been saying for some time, and it's definitely the market we are trying to serve."

Carr added the government's position had long been that Canada did not want to rely too much on one market. The United States takes virtually all Canada's energy exports.

The Liberal government said last week it would toughen its response to oil spills at sea, a move some environmentalists saw as a clear signal Ottawa would approve the Trans Mountain expansion.

The pipeline runs from Alberta to British Columbia. The government of British Columbia has laid down five conditions which must be met before it allows pipelines to be built on its territory. One of the demands is that the federal government upgrade its ability to tackle oil spills.

(Additional reporting by Nia Williams in Kamloops, British Columbia; Editing by Peter Cooney)