Refineries in East could save big with more Canadian crude: study

CALGARY A study by the Canadian Energy Research Institute concludes that refineries in central and Atlantic Canada would benefit in terms of lower supply costs and lower global greenhouse gas emissions if they bought more Canadian crude oil.

The study finds that substituting Canadian oil wherever possible using space on existing pipelines, railcars and ocean tankers would result in a 47-per-cent decrease in foreign oil imports into Eastern Canada, saving the refineries $210 million per year and the equivalent of more than two million tonnes of carbon dioxide, or about 5.7 per cent.

It adds that expanding the transportation system through a new pipeline equal to Trans Canada Corp.’s cancelled Energy East would allow the eight refineries in Ontario, Quebec, New Brunswick and Newfoundland and Labrador to replace 57 per cent of imported oil at a savings of $317 million per year, while still cutting GHGs by two million tonnes.

CERI CEO Allan Fogwill says the report, based on 2016 numbers gathered mainly without the refiners’ co-operation, doesn’t answer the question of why they buy from foreign suppliers when it would make sense to buy from within Canada.

But he says he hopes its conclusions lead to a discussion about where the refineries source their oil.

The CERI study notes that the eastern refineries process just over one million barrels per day, of which 56 per cent comes from foreign countries led by the United States, 39 per cent comes from Western Canada and five per cent is from eastern Canadian sources such as the offshore oilfields of Newfoundland and Labrador.