China showing less interest in Alberta bitumen

energy assets during roughly the same period, may increase as China’s search for technical know-how needed to unlock domestic shale resources intensifies, said J.J. Chen, a former oil trader with Nexen Inc. with deep ties in the Pacific region.

“It’s a competition between Canada and the U.S.” for capital, he said Monday on the not a must” for China, which is eager to diversify its energy portfolio by sourcing a “basket” of different crude blends from around the world, Mr. Chen said.

“If you cannot get to tidewater, then Canada becomes the last one into that basket,” he said.

It’s not just Chinese companies that are eager to get in on the U.S. energy boom. Firms from India, Japan and the U.K. are also spending billions on U.S. investments.

The investments come with U.S. oil production on track to surpass 7.3 million barrels a day this year, from an average of 6.5 million barrels last year.

Led by continued Bakken growth, U.S. oil output could jump by another one- to twomillion barrels per day in the next three or four years, said Geoffrey Brand, a senior economic advisor with the API.

The pace is accelerating such that “the tight oil production in the U.S. might actually become refinery constrained sooner than imports from Canada,” Mr. Brand said in an interview.

With export constraints on Canadian bitumen, it’s “not surprising” that China’s interest in the oil sands has waned, said Peter Howard, president and chief executive of the government- and industry-funded Canadian Energy Research Institute.

“They don’t understand why you can’t build a pipeline,” he said.

Domestic companies such as Imperial Oil Ltd. and Cenovus Energy Inc. are still investing in project expansions, Mr. Howard added, “but one thing we are noticing is the projects in the next wave are starting to be pushed down a little bit.”