Canada crude - Synthetic rises on planned upgrader work

Tue Mar 12, 2013 4:23pm EDT
 
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* April synthetic last trades at $6.75/bbl above WTI

* April WCS last at $20.25/bbl under WTI

CALGARY, Alberta, March 12 (Reuters) - Canadian synthetic crude prices strengthened on Tuesday with planned upgrader work expected to cut into supply.

Light synthetic crude for April delivery last traded at a premium of $6.75 per barrel above West Texas Intermediate, according to Shorcan Energy Brokers, up from a settlement price on Monday of $3.10 per barrel above WTI.

Suncor Energy Inc is expected to soon begin maintenance work on a hydrogen plant associated with its 100,000 barrel per day Upgrader 1 unit at its Fort McMurray, Alberta, oil sands project site.

The work, expected to last 14 weeks, will reduce output from the upgrader, which converts tar-like bitumen from the oil sands into refinery-ready synthetic crude.

The company also expects to carry out a full, seven-week maintenance shutdown of Upgrader 1 in the second quarter that will shut down production entirely until the work is complete.

Heavy oil prices weakened after Marathon Petroleum Corp reported a power outage at its 106,000 bpd Detroit refinery.

The company later said it had returned to normal operation.

Western Canada Select heavy grade for April delivery last traded at a discount to WTI of $20.25 per barrel, down from the day-prior settlement prices of $19.50 per barrel under the benchmark.