Irving Oil has secured approvals to move Alberta oil from the west coast to its refinery in Saint John, N.B. by tankers routing through the Panama Canal, a well as crude oil from Newfoundland and Labrador.
The new supply has emerged as the company moves to enhance its access to Canadian crude amid the COVID-19 crisis and years after TransCanada’s (now TC Energy) bid to build a pipeline from Alberta to Saint John collapsed.
“It is critical to our customers, to our business, and to energy security throughout Atlantic Canada that we are able to use foreign crude oil tankers to access Western Canadian crude oil on an urgent basis and going forward for one year to allow for effective and flexible supply chain planning and to strengthen the link between Canadian oil producers and our refinery in this challenging and uncertain time,” Irving Oil’s chief refining and supply officer Kevin Scott said in an application to the Canadian Transportation Agency last month.
The agency is allowing the company to move Alberta crude from the British Columbia coast down through the Panama Canal and back up to Saint John, where it runs Canada’s largest refinery. It is expected vessels will load and deliver between approximately 350,000 to one million barrels of product.
“From western Canada to offshore Newfoundland, we’re expanding our reach as we continue to pursue solutions that help create energy security for our country. We know that by working together, we are all stronger,” Irving Oil spokeswoman Candice MacLean said.
The route is estimated to be about 6,300 nautical miles or nearly 12,000 kilometres – more than 2.5 times the length of the proposed Energy East pipeline. The pipeline proposed by TransCanada Corp. was shelved in 2017.
Irving Oil also plans to pick up Canadian crude at ports along the U.S. Gulf Coast and from offshore Newfoundland.
Tim McMillan, president and CEO of the Canadian Association of Petroleum Producers, applauded the move.
“We have seen there are limits to the reliability of rail transport with the recent blockades and the cancellation of the Energy East pipeline leaves our country with few options to move our resources to the East Coast,” he told CBC News.