When All Else Fails

China Buys Majority Stake in Canadian Oil Sands Company


China’s state-owned energy company, PetroChina, got a welcome gift this holiday season: final approval from the Canadian government to acquire a 60 percent stake in Athabasca Oil Sands Corp., one of the major players in northern Alberta’s vast oil reserves, which are second only to Saudi Arabia’s in size.

Last summer, PetroChina and privately held Athabasca announced an agreement for the Chinese company to buy a 60 percent stake in Athabasca for $1.7 billion. By Canadian law, the transaction was subject to review by the Canadian government. Industry Minister Tony Clement gave the necessary approvals on December 29.

“I have approved the application by PetroChina under the Investment Canada Act to acquire control of the MacKay and Dover Oil Sands projects because I am satisfied that the investment is likely to be of net benefit to Canada,” said Clement.

Northern Alberta’s vast oil reserves have been the subject of considerable investment by foreign entities. Sinopec Corp. owns a 50 percent stake in the Northern Lights project, 100 kilometres northeast of Fort McMurray, and French energy giant Total SA holds the other 50 percent.

China National Petroleum Co. bid on and obtained 11 oil sands leases in 2007, and in 2005 the Chinese Offshore Oil Corp. invested $150-million in Calgary-based Meg Energy.

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