MONEY IN BRIEF

Crude-by-rail exports reach a record

CALGARY (CP) — The National Energy Board says crude-by-rail exports from Canada rose to a record 269,829 barrels per day in September.

That’s up more than 17 per cent from 229,544 in August and just over double the 134,132 barrels per day recorded in September 2017.

Total crude exports reached 3.47 million bpd in September, up from 3.31 million a year earlier.

Pipeline export constraints are being blamed for a glut of oil in Western Canada that caused the price discount to peak at more than US$50 per barrel in October for Western Canadian Select oilsands blend versus New York benchmark West Texas Intermediate. The province has called on Ottawa to help increase crude-by-rail shipments, estimating the discounts are costing the Canadian economy as much as $80 million per day. Meanwhile, oilsands producers such as Cenovus Energy Inc. and Imperial Oil Ltd. are ramping up crude-by-rail volumes to get barrels to markets where they will receive better prices.

Cenovus has called on the province to impose production cuts to reduce the oil oversupply in Alberta but the suggestion has been panned by rivals who are insulated from discounts because they have firm pipeline contracts or use their oil in their own refineries.

Legal challenge filed in warship saga

OTTAWA (CP) — The $60-billion effort to build new warships for the navy has hit another snag, this time in the form of a legal challenge by one of three companies involved in the high-stakes competition to design the vessels.

The federal government announced last month that U.S. defence giant Lockheed Martin beat out two rivals in the long and extremely sensitive competition to design replacements for the navy’s frigates and destroyers.

Lockheed’s design was based on a new class of frigates for the British navy. The company is now negotiating a final contract with the government and Halifax-based Irving Shipbuilding, which will build the ships.

But one of the other two companies, Alion Science and Technology, is now asking the Federal Court to quash the government’s decision, saying Lockheed’s design did not meet the government’s stated requirements and should have been disqualified. Industry insiders had long warned that Lockheed’s selection as the top bidder combined with several changes to the competition after it was launched – including a number of deadline extensions – would spark lawsuits.