Documents show Fort McMurray wildfire raised worries in Ottawa
Federal officials raised the possibility of relaxing competition and fuel quality rules to ensure a stable supply of fuel while the Fort McMurray wildfire raged and forced several northern Alberta oilsands projects to shut down.
Documents obtained by The Canadian Press under the Access to Information Act highlight some of the options Ottawa was examining if shortages got bad enough during Canada’s most expensive natural disaster, which drove more than 80,000 Fort McMurray residents from their homes for a month or more in May 2016.
A May 10 “update on energy operations” sent to Natural Resources Canada staff noted as many as 1.5 million barrels a day of oilsands production were offline.
“Companies have reported that fuel inventories remain adequate, but steps are being taken to source alternative supplies from outside the region to supplement current supplies,” the document said.
“If the situation persists, there may be requests to relax restrictions under the Competition Act to enable greater information sharing and collaboration amongst industry on issues related to fuel supply, or to relax federal fuel quality standards to enable greater access to fuel supply from other regions.”
The note said Natural Resources Canada was working with the Environment, Justice and Innovation, Science and Economic Development ministries to explore a process to respond to any potential requests of that nature.
It didn’t end up coming to that.
A Natural Resources spokeswoman said no industry players made such requests and representatives from Alberta’s three biggest refiners — Suncor Energy (TSX:SU), Imperial Oil (TSX:IMO) and Shell Canada — confirmed they did not ask.
Under the Competition Act, it is illegal for competitors to work in concert on price setting, market allocation and supply restriction.
Competition Bureau enforcement guidelines say the sharing of competitively sensitive information can be a concern.
“An agreement to disclose or exchange information that is important to competitive rivalry between the parties can result in a substantial lessening or prevention of competition,” says a 2009 document setting out competitor collaboration guidelines.
Shell spokeswoman Tara Lemay said the company kept provincial and federal governments up to speed on its inventory situation, keeping in mind competition law restrictions.
“Our supply group worked tirelessly to serve our customers and the community during one of the worst natural disasters in Alberta’s history,” she said in an email.
“Thanks to their hard work, we were able to leverage Shell’s North American-wide trading network to help limit the impact of inventory shortages at the pumps, both in critical markets like Fort McMurray where emergency services needed fuel to continue their work, and in other customer markets as well.”
There was very little supply disruption at Shell, aside from some minor shortages in Edmonton, said Lemay.
It was a tougher situation for Suncor. In early June 2016, Suncor’s Petro-Canada branded stations in Western Canada ran out of fuel due to the ongoing impact of the wildfires and an outage at its Edmonton refinery.
A giant fireball is seen as a wild fire rips through the forest 16 km south of Fort McMurray, Alta., on highway 63 on May 7, 2016. Federal officials raised the possibility of relaxing competition and fuel quality rules to ensure a stable supply of fuel while the Fort McMurray wildfire raged and forced several northern Alberta oilsands projects to shut down.