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Pipelines needed to meet Indian demand for Alberta bitumen

Darcy Henton, Calgary Herald, Jan 16 2014

EDMONTON — India has a voracious thirst for oilsands bitumen, but Alberta needs to have pipelines to deliver the product to tidewater before it can finalize any major deals with the country’s energy industry, International and Intergovernmental Relations Minister Cal Dallas said Thursday.

“Talking about the scale of increase in volume which would easily surpass a million barrels per day at its optimum, it is likely that these infrastructure projects need to be completed before that’s going to happen,” Dallas said.

Analysts are forecasting India’s energy demand will climb more than 130 per cent over the next two decades and Alberta wants to be in a position to meet that demand.

But state and private company officials meeting with Dallas and Premier Alison Redford in India this week all asked about the progress of proposed pipeline construction, the minister told reporters in a conference call.

“Clearly that’s key,” Dallas said. “I think the preferred option is Canada and the barrier to that is that port access.”

A number of companies in India are already running test batches of bitumen through their refineries — product that was transported from Alberta by rail to Canadian ports to be shipped overseas, he said.

Alberta is counting on three pipelines proposed to carry bitumen to the west coast, east coast and U.S. Gulf Coast, and has even committed to pay billions of dollars in tolls to ship product in one of the lines.

Dallas was less concerned that Canada’s foreign ownership rules will hinder Indian investment in the oilsands.

“The key to their interest is around being able to acquire the bitumen or refined product,” he said. “I didn’t really get a strong sense that this was a huge deterrent in this particular marketplace.”

Dallas said Alberta’s resolve to address the pipeline infrastructure issue was reinforced by federal Natural Resources Minister Joe Oliver, who addressed an energy conference in India this week while the Alberta mission was in the country.

Oliver said in a statement that “much of the spadework” has been done and India and Canada are ready to enter “a new era of co-operation and commerce that will help create jobs and opportunities across our country.”

Alberta’s $120,000 trade mission has been highlighted by the opening of provincial trade offices in New Delhi and Singapore at an annual cost of $1.3 million. Alberta now has 12 international trade offices around the globe.

© Copyright (c) The Calgary Herald


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