Posted May 23, 2013, 2:04 PM
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Registered User
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Join Date: Jun 2006
Location: Grand Bay-Westfield :: NB
Posts: 3,088
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This news has nothing to do with SJ at this point but could have an impact down the road. As Valero/Ultramar has committed to Enbridge Project, I wonder whether Irvings likewise have committed to Trans Canada Pipeline project that would bring the pipeline from Montreal to Saint John ?
Quote:
Tapping Quebec’s oil opportunity
SHAWN McCARTHY - GLOBAL ENERGY REPORTER
OTTAWA — The Globe and Mail
Published Wednesday, May. 22 2013, 7:22 PM EDT
Texas-based Valero Energy Corp. will invest as much as $200-million in its Quebec refinery if Enbridge Inc. proceeds with its plan to reverse its Line 9 pipeline, a project one Quebec business leader described Wednesday as critical to the province’s refining and petrochemical industry.
In a presentation to analysts, Valero chief executive officer Brian Klesse said the San Antonio-based company has committed to take “substantial volume” of light crude from Enbridge’s Line 9, which, subject to regulatory approval, will be reversed to bring oil from western North America to Montreal. Valero will then deliver the crude from Montreal to its refinery near Quebec City by company-owned ships down the St. Lawrence.
Valero plans to invest between $110-million and $200-million to overhaul its handling capacity at the refinery, including increased tankage and new crude-carrying ships, in order to increase access to North American crude. That will provide it with a competitive advantage over Atlantic basin refineries that rely on high-priced imports.
In addition to supporting Enbridge’s Line 9B reversal, Valero is expanding the 265,000-barrel-a-day refinery’s ability to receive western crude by rail and will import up to 50,000 barrels a day from Texas’s prolific Eagle Ford tight oil play.
“I believe that within a year or two, our Quebec refinery will be a North American-supplied refinery where today it is a foreign-supplied refinery,” Mr. Klesse said in a presentation.
Suncor Energy Corp. also expects to virtually eliminate the need for imported crude to feed its 135,000-barrel-a-day operation in Montreal, a city that has seen five refineries close over the past 25 years.
The Enbridge project – along with TransCanada Corp.’s proposed pipeline to Eastern Canada – got a boost Wednesday from Quebec’s Federation of Chambers of Commerce. In a speech at the Toronto Board of Trade, chamber president Françoise Bertrand said the new oil pipelines are crucial for the competitiveness of the refining and petrochemical industry in Quebec, particularly in Montreal’s east end where Royal Dutch Shell PLC closed a refinery just three years ago.
“Every necessary means must be taken to ensure that the refining industry remains competitive and active in Quebec,” Ms. Bertrand said.
In a telephone interview, she said that despite opposition from environmental groups, the “silent majority” of Quebeckers are supportive of plans that would wean the province off imported oil, especially if that means protecting high-wage jobs. A chamber-sponsored poll found 70 per cent of Quebeckers supported the Enbridge plan to bring western crude to Montreal.
She said the loss of refineries in Montreal devastated her province’s industrial employment base. “We cannot afford to lose more of them,” she said in the interview. “And the petrochemical industry is also much more interesting today because of the new projects that are developing.”
The National Energy Board will hold hearings in Ontario and Quebec on Enbridge’s pipeline reversal, while TransCanada is in the process of assessing commitment from shippers before submitting to the regulator its plan to convert a portion of the natural gas mainline to carry oil.
Ms. Bertrand acknowledged that the public has had its confidence shaken with images of major pipeline spills, first by Enbridge in Michigan in 2010 and this spring by Exxon Mobil Corp. in Arkansas.
Enbridge spokesman Glenn Herchak said the company responded to the Michigan accident by spending $1.7-billion over three years to overhaul its safety practices, both in spill prevention and response.
But environmentalist Stephen Guilbeault, of the Montreal-based group Equiterre, said supporters of the pipelines should not underestimate the concerns in Quebec. He noted that several municipalities, including Montreal, have urged the provincial government to hold its own environmental assessment of the Line 9 plan.
Mr. Guilbeault said Quebeckers support the need for tough action to reduce greenhouse gas emissions, and would not be supportive of pipelines through the province than enable the expansion of the carbon-intensive oil sands. “To people who think this is a fait accompli or a slam dunk, I would say they need to err on the side of caution,” he said.
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