Alberta is considering a financial investment in the refining sector of Japan, two sources familiar with the Reuters issue said.
It is an attempt to reduce the overwhelming dependence of the province in the main commercial partners, United States for oil exports.
Alberta’s government is in initial stage conversations with several Japanese crude oil refineries to explore a joint company in which it could help finance the construction of a COKER unit that would allow one or more Japanese companies to process a heavy crude produced in the Alberta oil sands, the sources said.
Any unprecedented agreement for Alberta, which has not previously made investments of energy infrastructure in foreign countries. But the province is anxious to increase its oil exports since last year’s opening of the expansion of the Trans Mountain pipe, which increased Canada’s capacity to send oil through the Pacific coast.
An agreement with Japan would help reinforce oil flows in Trans Mountain, the only Esta-West Canada oil pipe, and would also help defend a new export pipe for which the Alberta government is pressing.
Conversations about an investment in Canada and Japan are in very early stages, and nothing has been over, said one of the sources.
For Japan, a coker would boost the amount of heavy crude, such as Canadian oil, which can be processed in the country.
The heavy and high Canadian crude is currently incompatible with most existing refining facilities in Japan, and the country now matters most of its oil from the Middle East.
The highest Canadian crude purchases that can travel directly through the Pacific Ocean would also reduce Japan dependence on shipments through the South China Sea, a maritime strangulation point if regional tensions arise.
Canada is the fourth largest oil producer in the world, but its main oil -producing province of Alberta is without coastline, with limited access to Tidewater ports. That means that most of the Canadian oil, around 4 million barrels per day or 90 percent of its total exports, is sent to the USA. Through pipes that work from north to south.
Alberta government representatives have made several trips to Asia, particularly Japan and South Korea, with the aim of increasing interest in Canadian oil.
“Alberta is exploring opportunities in Japan to sell our light and heavy oil,” said Alberta Energy Minister Brian Jean, in a statement sent by email. He declined to comment if Alberta’s government was in conversations to invest in the refining sector of Japan.
The Federal Government of Canada is aware of the current opportunities for Japan to buy additional volumes of Canadian oil, said a spokesman for the Federal Minister of Natural Resources, Tim Hodgson.
“Natural Resource Canada (NRCAN) is closely monitoring the developments and remains open to associating with provinces and industry to support strategic energy projects that the national interests of Canada advance,” said the spokesman in an email.
Last year, an expansion to Trans Mountain Ppeline tripled its capacity to 890,000 barrels per day and opened opportunities for Canadian oil along the west coast of the United States and in Asian markets.
China has become the main buyer of the Canadian crude sent through Trans Mountain Pipeline, followed by the west coast of the United States. South Korea has recently intensified purchases, giving third place, while Japan, India, Singapore, Brunei and Taiwan have bought loads rarely.
Since the expansion, Eneos Holdings from Japan bought a load of 250,000 barrels last year and so far this year has bought a load of 550,000 barrels, according to Kpler Ship’s follow -up data.
The Trans Mountain Pipeline operator is also watching a series of projects aimed at increasing system capacity by 200,000 to 300,000 barrels per day.
Meanwhile, Alberta’s government is anxious to increase oil production in the province and has been pressing pipelines hoping to attract a private sector company to build a new export duct of crude oil to the northwestern coast of Canada. Canada exported an average of 4.2 million BPD of oil in 2024, approximately 80 percent of its total production.
