Canadian newspaper mogul nears refinery financing -report

Wed Mar 6, 2013 4:04pm EST
 
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* Oppenheimer Investments would lead debt financing

* Refinery would be Canada's largest at 550,000 bpd

* Black says project would help Alberta oil industry

March 6 (Reuters) - A Canadian newspaper magnate said he is close to finalizing a C$25 billion ($24.3 billion) financing deal for his proposed West Coast refinery project aimed at creating a new market for Alberta oil sands production, a media report said on Wednesday.

David Black, who announced the project last year, told a business audience in Vancouver he expects to sign a memorandum of understanding with Swiss-based Oppenheimer Investments Group for the proposed plant, which would be located in Kitimat, British Columbia, according to a report in the Vancouver Sun.

The newspaper quoted Richard Cooke, senior managing director of Oppenheimer Investments, as saying the firm had enough investors to fund the whole debt financing. The arrangement would keep all of the ownership within the Canadian province.

The 550,000 barrel a day plant would easily be Canada's biggest refinery, with a cost of C$16 billion. The rest of the money would go to oil and natural gas pipelines as well as tankers, according to notes from Black's speech to the British Columbia Chamber of Commerce.

"The refinery will also provide enormous benefits for Alberta and Canada in that it will consume 400,000 barrels per day of heavy oil from Alberta that is in danger of being landlocked," Black said.

"By changing the North American supply/demand situation this will have the additional positive effect of reducing the C$25 billion per year of existing sales discounts on all Canadian oil exported to U.S. refineries, freeing up more profit and more income tax."   Continued...