Japan and Canada have formally agreed to launch negotiations on a bilateral free trade agreement (FTA) to eliminate import tariffs on most products and cooperate on developing energy resources, including natural gas and minerals, reports Platts.
In a joint statement issued following a meeting between Canadian Prime Minister Stephen Harper and his Japanese counterpart Yoshihiko Noda in Tokyo, both leaders recognized the importance of accelerating efforts to facilitate cooperation between the private sectors of the two countries.
The meeting coincides with a growing interest in Japan for importing shale-gas based liquid natural gas from Canada as a means to diversify its supply. It is also well timed as an unconventional gas seminar hosted by the Alberta government, was held in Tokyo last week, as demand for liquid gas is dramatically increasing in Japan as an alternative to atomic power. The event attracted more than 200 delegates from both the private and the public sectors.
The Canadian oil and gas industry celebrated the pact, qualifying it as "very good news" for Alberta and the country.
“Demand for Canadian products like crude oil and natural gas is strong in Asia and growing,” said Canadian Association of Petroleum Producers (CAPP) President Dave Collyer. “Oil and natural gas exports, primarily to the United States, currently contribute some $80 billion to the Canadian economy annually. Diversifying markets for Canadian oil and natural gas products is vital to ensuring Canada continues to grow its oil and gas production and receives full value for its natural resources.”
In addition to developing new export markets, Canada’s oil and gas industry continues to explore cost-competitive ways of providing Canadian crude oil and natural gas to domestic markets and the United States, reducing North American dependence on foreign imports.
According to the International Energy Agency, the dynamics of energy markets will be determined more and more by Asian economies, especially China. Over the next 25 years, China alone will account for over 30% of the projected growth in global energy demand, consolidating its position as the world’s largest energy consumer.