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Canada and China are natural partners in the energy sector – not only in relation to primary sources of energy, but also in the areas of renewable energy, including solar, wind, geothermal, hydraulic and biomass, and technology development. Canada has strong and longstanding reputation as an

important, stable and reliable supplier of energy resources, technology and services to world markets.  China, as a large consumer of primary energy and an emerging leader in technology for traditional and clean energy, represents an ideal partner for long-term collaboration.   

In 2001, Canada and China signed the Memorandum of Understanding (MOU) on Energy Cooperation, which was renewed in 2006. Then, in 2009, the Canada-China Joint Statement identified the energy sector as a focus for cooperation that presents significant opportunities to both countries. In 2012, the MOU was extended allowing Canada and China to reinforce and expand their cooperation; and in 2013, the Alberta China Framework Agreement was signed in the presence of Canadian Governor General David Johnston and President Xi Jinping, which complements the Canada-China MOU on Energy Cooperation to increase ties in sustainable energy development, investments and trade.  In 2014, Canada and China signed an expanded Memorandum of Understanding on Nuclear Cooperation.   

Oil and Gas 

Canada has the third largest proven oil reserves in the world, at 171 billion barrels. Today, it ranks as the fifth largest producer of oil, producing more than 3.5 million barrels a day. Canada is the world’s fourth largest producer of natural gas with recoverable resources estimated at between 885-1,566 trillion cubic feet (Tcf).  

At present, China is the third biggest export destination for Canada’s oil.  In 2015, Canadian exports of crude oil were up 119.6% to $107 million, a boost in value that happened in spite of continued downward pressures on crude prices. In fact, Canadian crude exports to China surged 255% in volume terms.  

Canada enjoys a global reputation as a superior supplier of oil and gas equipment, technologies and services and is committed to serving the Chinese market. Canada’s advantages build on its considerable strengths, including, among others, its rich energy resource endowment. While Canada has traditionally been the major energy supplier to the United States, it now aims to be a major energy supplier to the world. There is tremendous opportunity for Canada to supply more oil to China and to help it meet its expanding energy requirements.   

Canada is also an important hub for innovation in the oil and gas sector. With the support of government, industry and research institutions, the Canadian oil and gas supply sector has established itself as a world leader in innovation. Canada’s commitment to mitigate the environmental impact of oil and gas drilling and oil sands mining has created a particular niche in environmental protection technologies. Canada is also a world leader in such areas as Arctic drilling, unconventional oil and gas recovery, enhanced oil recovery, carbon capture and storage and seismic exploration. There is terrific potential for Canadian and Chinese companies to work together in China and globally in developing and utilizing products, technologies and solutions which will ensure the long-term sustainability and address the economic challenges of the industry.  

Thanks to its abundant resources, stable political and regulatory environment, attractive production economics, proximity to the largest consuming market and many other advantages, the Canadian oil and gas sector has attracted major foreign investors, such as Shell, Total, ConocoPhilips, CNOOC, Repsol, and BP, among others. The stock of foreign direct investment (FDI) in the energy sector is estimated to have reached $190 billion in 2014, accounting for more than 25% of Canada’s total FDI.  Today, China’s remarkable growth is driving global energy and natural resources demand and this fundamental shift is helping to redefine and expand the Canada-China relationship. With China, as the world’s largest consumer of energy, minerals and metals, and Canada, as a global energy and resources leader, there is a natural complementarity in this regard. As such, Canada is one of the major overseas investment destinations of Chinese companies in the energy sector.  

Natural Gas  

Canada is the world’s fourth largest producer of natural gas with recoverable resources estimated at 885-1,566 trillion cubic feet (Tcf). Indeed, Canada will play a critical role as the world makes the transition to a lower carbon future, especially now as it prepares to enter the liquefied natural gas (LNG) market, which will bring about major changes and opportunities to the Canadian and global energy sectors. At present, a number of LNG rojects are being proposed in British Columbia and Eastern Canada, 24 of which have secured export licences from the National Energy Board. China has set a target to raise its natural gas share of energy mix from the current 5.9% to 10% in 2020, in part by increasing LNG and pipeline gas imports. As China seeks diversified sources of gas to meet its natural gas demand, Canada is well positioned to be a reliable and competitive supplier. Many of the LNG proponents in Canada have established partnerships or are looking to establish partnerships with Chinese companies to develop their LNG projects in Canada.  

Canada is becoming an important producer of shale and tight gas. The industry has had significant experience with horizontal drilling and hydraulic fracturing, which are key developments that can help Chinese partners to improve the long-term outlook for their domestic natural gas production. Canadian companies are well positioned to expand production and bring shale gas resources to China, as well as to provide innovative technologies and expertise that can be applied to shale resource assessment and environmental impact management, among other things. Canada is at the forefront of these innovations and keen to work with strategic partners in China and elsewhere to help transfer and adapt the technologies and innovations responsible for North America’s “shale gas revolution”.  

Leadership in Carbon Capture, Utilization and Storage   

Canada is investing to ensure that it achieves its emissions-reduction objectives through technologies such as carbon capture, utilization and storage (CCUS) and is recognized by the International Energy Agency as a global CCUS leader.  

One shining example is Saskatchewan Power Corporation’s (SaskPower) Boundary Dam III Project, the world’s first and largest commercial-scale CCUS project of its kind, which became fully operational in late 2014. Using ground-breaking technology, the rebuilt coal-fired generation unit #3 will reduce carbon dioxide (CO2) emissions by up to 90% , and provide a post-combustion capture of 1 million tonnes of CO2 annually.  Canadian energy company, Cenovus Energy, built the pipeline to transport the captured CO2 to oil fields 70 km away where it will be primarily used for enhanced oil recovery (EOR), while unused CO2 will be stored by the Aquistore research project. CO2-EOR extends oilfield life and provides revenue for the CCUS process.   

In February 2016, SaskPower announced the creation of the International Carbon Capture and Storage Knowledge Centre at Innovation Place Research Park in the city of Regina; it will operate as an independent not-for-profit organization dedicated to research, development and knowledge-sharing of CCUS technology. The Knowledge Centre was established by SaskPower and BHP Billiton; BHP Billiton has committed a $20 million investment while SaskPower will contribute its CCUS expertise.   

Nuclear Energy  

Canada has more than 60 years of nuclear power experience, including in uranium mining,the design, construction and operation of nuclear power plants, decommissioning, waste management, regulation and governance – all of which has made Canada a Tier One Nuclear Nation. Indeed, Canada plays an influential role in the global industry, both commercially and in international organizations.   

Canada is the world’s second largest producer of uranium, producing between 8,200 and 12,500 tonnes a year since 1998. It has the fourth largest uranium reserve after Australia, Kazakhstan and Russia. Canada currently exports 80% of its uranium, mainly to North and South America (36%), Europe (23%), and Asia (41%). Canada’s uranium supply is located in northern Saskatchewan, home to the world’s largest high-grade deposits and which have grades 10 to 100 times greater than the average anywhere else in the world.  

Canada has developed a unique nuclear reactor called CANDU, CANada Deuterium Uranium, which is a pressurized heavy water reactor (PHWR). They are distinguished from their light water reactor (LWR) counterparts because they use natural, unenriched uranium as a fuel, have enhanced safety features that help address post-Fukushima concerns, and feature relatively simple operating equipment, including refuelling while operating at full power. With some modification, they have the potential to use recycled uranium and even thorium. The original CANDU designer was Atomic Energy of Canada Limited (AECL), a federal crown corporation created in 1952. In 2011, responsibility for all commercial CANDU design, maintenance services and marketing was transferred to Candu Energy, a wholly-owned subsidiary of SNC-Lavalin. There is a comprehensive nuclear energy supply chain in Canada supplying to CANDU and other nuclear reactor systems in Canada and abroad.   

About 15% of Canada’s electricity is produced by nuclear power. Ontario’s three nuclear power plants, with 18 reactors, provide more than 50% of the province’s electricity. New Brunswick has one nuclear power plant. Outside of Canada, CANDU reactors are operating in India, Pakistan, Argentina, South Korea, Romania and China.   

Renewable Sources of Energy  

Canada is committed to making its energy use and production cleaner by increasing energy efficiency, expanding renewable energy production, and reducing the environmental impacts of conventional sources. Canada is a global clean technology industry leader; its market value was worth $1.5 trillion in 2014 and is expected to reach $5.2 trillion by 2022. The industry is export-oriented and grew by 14%, from 2013 to 2014, to reach$6.6 billion in export revenues. While the US and Europe remain Canada’s main export destinations, China, Latin America, Australia, the Middle East, Africa and India are also growing in importance.   


Canada is one of the world’s largest producers of clean, renewable hydroelectric power, with an installed production capacity of more than 75,707 megawatts (MW) in 2013.  There is the potential to more than double Canada’s hydroelectric capacity. Indeed, in 2013, hydro power accounted for 63% of net electricity generation in Canada, and nearly 11% of global production.  


Canada is a world leader in the development of processes for converting cellulosic-based feedstocks, such as agricultural and forestry waste, into cellulosic ethanol. In 2014, Canada produced 1,731 million litres of bio ethanol and exported 289 million litres of biodiesel.  

Ethanol production plants currently operate in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec. Environment Canada requires 5% renewable content in gasoline fuel and 2% renewable content in diesel and heating.  

With the support of the Government of Canada, Iogen Corporation built the world’s first full-scale demonstration plant to convert biomass fibres into cellulosic ethanol using enzyme technology. The Ottawa-based plant can process more than 25 tonnes of wheat straw a week, using enzymes produced in an adjacent facility.  

Wind power 

Canada’s total wind energy capacity was more than 9,694 MW at the end of 2014 and the country now has enough installed wind energy capacity to meet 1.9% of Canada’s total electricity (2013). Ontario has the highest mix of wind energy capacity at 36%.  

Solar power 

Solar energy production is growing in Canada. Solar installations reached a new record of 687MW in 2015, and investment in solar power climbed 47% to reach $2.8 billion. One fine example is the Drake Landing Solar Community (DLSC), a master-planned neighbourhood in the Okotoks, Alberta, which has successfully integrated Canadian energy-efficient technologies with the ultimate renewable and unlimited energy source – the sun.  

The first of its kind in North America, DLSC is heated by a district system designed to store abundant solar energy underground during the summer months and distribute the energy to each home for their heating needs during the winter. The system is unprecedented in the world as it fulfils 90% of each home’s space heating requirements using solar power and thereby lessed that community’s dependency on limited fossil fuels. 

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