From Interfax China:
Shanghai. July 16. INTERFAX-CHINA - The China National Petroleum Corp. will bail out of a landmark oil pipeline project in Canada as well as reduce investment in other oil sand projects in the country due to insufficient support from the conservative Canadian government, a senior company official said during an industry conference held in Canada's resource-rich city of Calgary late last week.
This is actually good news, because all good Canadians should want the Gateway Pipeline project dead as a doornail. Forget about the environmental problems that arise when you run an oil pipeline through a bunch of mountains, and think of the larger issues around the "greening" of the tar sands. Right now the best hope for that lies not in Ottawa, but South of the border.
California, for example, has passed a clean gas law that requires cuts in carbon emissions through the entire life cycle of the product, from extraction to transportation to final combustion. In May, Ontario and B.C. got on board with this concept, signing agreements with Governor Schwarzenegger to only consider oil purchases from low emitting sources. Furthermore, national (U.S.) legislation with a similar intent may be as little as two years down the road.
Since so much energy goes into producing gas from the tar sands, this kind of legislation will pressure the players in the Alberta Oil Industry to get their act together. If they don't clean up their processes, they won't be able to sell their product.
Unless of course they have a pipeline to the Pacific that lets them sell dirty oil to the less finicky Chinese. No pipeline, no escape hatch. See?