July 31, 2014 / 3:23 PM / 4 years ago

UPDATE 1-Suncor to fill Montreal refinery with internal crude by early 2015

(Adds quote, details on refining)

By Nia Williams

July 31 (Reuters) - Suncor Energy Inc anticipates being able to fill its 137,000-barrel-per-day refinery in Montreal, Quebec, from internal crude sources by early 2015, chief executive officer Steve Williams said in an earnings call on Thursday.

Canada’s largest energy company has in the past sourced crude from the U.S. Gulf Coast and international Brent market as well as Atlantic and Western Canada for its Montreal facility.

But new rail unloading capacity of approximately 36,000 barrels per day at the refinery and the expected reversal on Enbridge Inc’s 300,000 bpd Line 9 to Montreal by the end of the year means that Suncor should be able to rely on its own crude as a feedstock.

That will likely cut costs as Western Canadian crude tends to trade at a discount to the U.S. benchmark West Texas Intermediate. North American grades are also cheaper than international Brent crude.

“As we move into next year, you will see us increase the volume into Montreal refinery at internal continental prices,” Williams said. “Early next year we anticipate being able to fill the Montreal refinery from a combination of different internal sources.”

Suncor is reviewing the possibility of building a coker at the Montreal refinery to allow it to process more heavy crude.

Williams said Suncor was not going to fast-track the project and it would be developed in line with capital discipline practices, but he expected a request for funds to come to him sometime around the middle of next year.

Montreal is one of four Suncor refineries, giving the company total refining capacity of around 462,000 bpd.

In its earnings statement released late on Wednesday Suncor said the Montreal refinery has an 11-week planned maintenance event beginning late in the third quarter of 2014.

The Edmonton, Alberta, refinery has four weeks of planned maintenance in the third quarter of 2014, and the Sarnia, Ontario, refinery has an eight-week turnaround at about the same time.

Suncor shares were last down 2.6 percent on the Toronto Stock Exchange at C$44.60.

On Wednesday, the company reported a 69 percent fall in second-quarter profits as it took a substantial charge to account for a delay to its Fort Hills oil sands mining project in northern Alberta. (Editing by Jeffrey Benkoe and Gunna Dickson)

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