Valero aims to cut costly crude imports to Quebec refinery

Wed May 29, 2013 6:02pm EDT
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* Valero plans to use more Canadian crude at Quebec refinery

* Company supports Enbridge's proposal to reverse Line 9

* Valero expects to own fleet of 12,000 rail cars by 2015

CALGARY, Alberta, May 29 (Reuters) - Leading independent U.S. refiner Valero Energy Corp said on Wednesday it will spend up to $190 million to enable its Quebec refinery to use more cheap Western Canadian crude rather than relying on pricier imports.

The company plans to build a rail off-loading facility at its 265,000 barrel per day Jean Gaulin refinery in Levis, Quebec, and expand the terminal at its Montreal East facility, in anticipation of the proposed reversal of Enbridge Inc's Line 9 pipeline connecting Ontario and Quebec.

"This will make oil available to the refinery to process Western Canadian crude rather than expensive cargoes from West Africa and the North Sea," Valero spokesman Bill Day said.

"Western Canadian crude is some of the least expensive oil on the planet right now."

A reversed Line 9 would transport up to 300,000 bpd, and ship western Canadian crude eastward rather than transporting more expensive Brent crude oil from the North Sea, West Africa and the Middle East in a westbound direction.

Day said the refinery would take light, sweet Western Canadian crude rather than oil sands crude. A barrel of light, sweet crude for July delivery in Edmonton, Alberta, last traded at $7.25 below the West Texas Intermediate benchmark.   Continued...