Fu­elling con­cerns

Doc­u­ments show Fort McMur­ray wild­fire raised wor­ries in Ot­tawa

The Guardian (Charlottetown) - - BUSINESS - BY LAU­REN KRUGEL THE CANA­DIAN PRESS

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.

CP PHOTO

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.

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