China bank to fund proposed West Canada refinery
By ALISTAIR MACDONALD
TORONTO -- Canadian media mogul David Black said late Thursday the Industrial & Commercial Bank of China, China's largest bank by market value, has agreed to help finance his plans for a $25 billion refinery on the west coast of Canada.
The British Columbia-based businessman has been touting what he says will be among the 10 largest refineries in the world. It envisions refining oil from Alberta's oil sands and exporting it from the Pacific port of Kitimat, B.C., to markets in Asia.
Mr. Black is better known as the majority owner of closely held Black Press Group, which runs more than 150 newspapers in British Columbia, Alberta, Washington state, Hawaii, California and Ohio. But he's recently made headlines in Canada for his ambitious refinery plans.
Such a facility has been one idea floating around for years to help Canada better capture the value of its immense oil reserves. But many industry executives have said Canada would be better off simply exporting its unrefined crude to Asian markets.
At least two pipeline projects are in the works to bring Alberta crude to the West Coast, though both face stiff opposition from environmental and native groups.
Mr. Black told The Wall Street Journal last month that he is close to signing memorandums of understanding with customers for so-called off-take agreements, in which they would agree to buy products from the plant.
The ICBC commitment is the latest move by China to try to participate in a boom of energy production across North American. Cnooc snapped up Canadian oil producer Nexen last year for more than $15 billion, and other state energy and natural resources firms controlled by Beijing have pumped billions of dollars into Canadian and US assets in recent years.
Mr. Black's company, Kitimat Clean, signed memorandums of understanding with ICBC on Thursday for the Chinese bank to act as a financial adviser and "cooperate in the financing of the proposed Kitimat refinery and associated pipelines," Mr. Black said in a statement.
In an email, Mr. Black said he anticipates the Chinese bank will both help finance the project and help set up other finance.
ICBC will be working "toward a comprehensive agreement to finance" the refinery, Liu Yanping, deputy head of corporate banking at the bank and Huang Jifa, its deputy head of investment banking, said in the statement sent out by Mr. Black.
Dow Jones Newswires
Comments