Canada doesn’t have sufficient capital to fully develop its oil reserves, Oliver said in an interview, adding the key factor in government approval will be whether investments are being made for “commercial” purposes.
“As their investments get larger, they are watching to see whether we continue to be welcoming. We’ve told them we are welcoming,” said Oliver, who is accompanying Prime Minister Stephen Harper on a four-day visit to China. “Our oil sands are the largest energy project in the entire world. We simply don’t have enough capital in Canada.”
Harper led a delegation of more than 40 business executives and five ministers to deepen energy links with the Asian country and reduce Canada’s reliance on the U.S. after President Barack Obama rejected TransCanada Corp. (TRP)’s $7 billion Keystone XL pipeline to ship Canadian oil to the Gulf Coast. Canada, which sits on the world’s third-largest oil reserves, sends 99 percent of its oil exports to the U.S.
While all major foreign investments in Canada require government approval, there is additional scrutiny for acquisitions by foreign state-owned companies. Oliver said Chinese officials raised foreign ownership issues in Canada during the trip.
“What’s important is that they act as good corporate citizens, they act on a commercial basis, and they have been,” said Oliver, who spoke to Bloomberg on a flight from Guangzhou to Chongqing, the last stop of Harper’s tour.
Investment ties between China and Canada have been meager to date. Canadian direct investment in China was C$4.8 billion ($4.8 billion) in 2010, less than 1 percent of Canada’s total, while the C$14.1 billion in Chinese investment in Canada represents about 2.5 percent of the total, Statistics Canada data show.