Canadian crude oil is low risk and will stay competitive even if output in Venezuela rises after the U.S. capture of President Nicolas Maduro, Prime Minister Mark Carney said on Tuesday. U.S. President Donald Trump says American oil companies are prepared to tackle the difficult task of entering Venezuela and investing billions to restore production.
Venezuelan crude is heavy, similar to that produced in Canada’s oil sands, leading some analysts to speculate that Canadian product could eventually be displaced.
Carney said a functioning Venezuelan economy would produce more oil and increase stability in the Western Hemisphere, which he said was a good thing.
“Canadian oil will be competitive because it is low risk – clearly low risk – (and) low cost,” he said. Canadian oil is considered to have less risk for investors and buyers than crude from some countries because of Canada’s stable governance.
Carney added that a proposed carbon capture project in the oil-producing province of Alberta would make crude more attractive to buyers with concerns about greenhouse gas emissions.
“That makes Canadian oil competitive for the medium and long term… We welcome the prospect of greater prosperity in Venezuela, but we also see the competitiveness of Canadian oil,” Carney continued. Carney signed an agreement with Alberta’s premier in November that rolls back certain climate rules to spur investment in energy production, while encouraging construction of a new oil pipeline to the West Coast. No private-sector company has yet committed to building such a pipeline.
(Reporting by David Ljunggren Editing by Rod Nickel)