Enbridge's Line 9 oil pipeline to displace foreign crude in Quebec

Thu Oct 1, 2015 5:47pm EDT
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By Nia Williams

CALGARY, Alberta Oct 1 (Reuters) - Enbridge Inc's long-awaited start of its Line 9 oil pipeline to Montreal will allow Quebec refineries to run on 100 percent cheap North American inland crude, leaving around 100,000 barrels per day of foreign crude searching for a new home.

The Calgary-based energy company received approval from regulators on Wednesday to finally start operating the 300,000 bpd pipeline carrying mainly light crude from Sarnia, Ontario, to Montreal, Quebec, nearly a year after it was first expected in service.

For Quebec's two refineries, Suncor Energy's 137,000 bpd Montreal plant and Valero Energy's 265,000 bpd Jean Gaulin facility, the approval is a welcome boon.

Both will be able to switch to a diet of 100 percent West Texas Intermediate-linked crude such as Canadian light synthetic or North Dakota Bakken, displacing pricier Brent-linked feedstock from regions including West Africa and the North Sea.

At present the refineries receive crude by rail, seaborne imports into Quebec, and volumes from the Portland-Montreal pipeline, which transports imported crude north.

Data from Statistics Canada show in July, the most recent month available, Quebec imported 113,000 bpd of crude from Azerbaijan, Algeria and Nigeria. Another 206,000 bpd came from the United States and Canada.

Total foreign crude imports into the province from outside North America vary from month-to month, according to the data, but range around the 100,000 bpd mark.

Other countries that have exported to Quebec so far this year include Norway, Russia, Angola and the United Kingdom.   Continued...