Alberta Signs Deal With South Korea to Waive Crude Oil Tariffs

Alberta Premier Danielle Smith has signed a deal with South Korea to remove a 3 percent tariff on the province’s exports of crude oil to the country.

Smith said the agreement could significantly expand market access for Alberta producers, projecting exports to South Korea could rise to as much as 33 million barrels per year, generating up to $1 billion annually in additional export value.

The announcement comes as Alberta continues to benefit from expanded pipeline capacity following the completion of the Trans Mountain Expansion (TMX) project in May 2024, which linked Edmonton-area infrastructure to export facilities in Burnaby, B.C., and increased Canada’s access to Asian markets.

Alberta exported almost $400 million in crude oil to South Korea last year. Smith said that figure could increase substantially under the new arrangement, while speaking at the signing ceremony with South Korean Customs Commissioner Myeong-ku Lee in Edmonton on April 20.

South Korea is already a growing buyer of Canadian energy, with crude exports rising in recent years amid broader Asian demand for secure non-Russian supply sources.

The Korea Customs Service said the agreement is primarily aimed at resolving long-standing documentation and “rules of origin” issues under the Korea–Canada Free Trade Agreement (FTA). Previously, certification challenges meant Alberta crude often failed to qualify for preferential tariff treatment, resulting in a 3 percent import duty instead of the 0 percent FTA rate.

In a separate development, Alberta also signed a memorandum of understanding (MOU) with South Korea’s Hanwha Group, establishing a framework for potential investment in sectors including energy, natural resources, manufacturing, and defence industrial capabilities.

The province said the agreement provides a pathway for long-term collaboration intended to attract investment, expand market opportunities, and strengthen Alberta’s position in global supply chains.

“This agreement with Hanwha Group creates new opportunities to bring investment into our province, grow high-value industries and support good-paying jobs for Albertans,” Smith said.

Hanwha Group, founded in 1952, is a major South Korean conglomerate with operations spanning aerospace, defence, solar and hydrogen energy, finance, and construction, with a focus on advanced manufacturing and energy transition technologies. The company has been expanding its international footprint, including growing interest in North American investment opportunities.

“This partnership reflects a long-term view of Canada – not only as an energy partner, but as a strategic industrial counterpart. By aligning capabilities across energy, natural resources, shipbuilding, high technology, advanced manufacturing and other areas, we see an opportunity to contribute to Canada’s economic resilience and future industrial capacity,” Hanwha Energy chief executive officer Jae-Kyu Lee said in a release.

The province said further details on implementation timelines and potential investment commitments are expected in the coming months.