Energy
China to play big role in Canadian energy, minerals
By Gao Changxin (China Daily)
Updated: 2010-10-13 11:09
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BEIJING - China's investment in Canada's energy and minerals sectors is to double in the next five years as the world's second-largest economy hunts globally for resources to sustain its rapid economic growth, said Peter Harder, president of the Canada China Business Council.
"Canada has a rich reserve of natural resources and it needs overseas investments to explore them. That matches China's growing investment appetite in the area," Harder told China Daily on Tuesday.
China's investment appetite in Canada's energy and minerals sectors has surged in recent years, the latest example being Sinochem's potential bid for the Canadian fertilizer giant Potash Corp.
The State-owned company is reported to be planning a bidding consortium for Potash, which controls about a quarter of the world's potash production capacity, after the producer rejected a $39 billion bid by BHP Billiton as "inadequate".
Earlier this year, China Petroleum & Chemical Corp, the Beijing-based company known as Sinopec Corp, acquired a 9 percent stake in Syncrude Canada Ltd.
That followed last year's acquisition by PetroChina Ltd, China's largest oil company, of a 60 percent stake in a project run by Athabasca Oil Sands Corp and the sale by Vancouver-based Teck Resources Ltd of a 17 percent stake to China's sovereign wealth fund.
Though some fear that the Canadian government may block Sinochem's bid for Potash, Harder said the government harbors no hostility toward Chinese investments.
"As many high-level Canadian officials have said on many different occasions, Chinese investments in Canada's energy and minerals sectors are welcomed," said Harder. "As long as takeovers or mergers have a net benefit for Canada, it doesn't matter if it is (South) Korea, Brazil or China that made them."
In May, representatives of Canada's three most resource-rich provinces, British Columbia, Alberta and Saskatchewan, visited Beijing to seek Chinese investments.
"Rich in natural resources, Canada will play an important role in China's energy security plans," Xia Yishan, a researcher with the China Institute of International Studies, told China Daily earlier this year.
But still Canada is only one destination on China's energy and mineral resources buy list. In the last few years, the three big State-owned oil companies - PetroChina, Sinopec and China National Offshore Oil Corp - have acquired tens of billions of dollars worth of energy assets on almost every continent.
In 2009 alone, the three companies spent around $18.2 billion on energy deals and are on track this year to spend even more, according to the International Energy Agency.