Enbridge CEO skeptical of plans to upgrade bitumen in Alberta

CALGARY — The chief executive of pipeline firm Enbridge Inc. (TSX:ENB) says oilsands bitumen should be processed in Alberta only if it makes economic sense for producers to do so, despite worries over jobs and investment being lost to the United States.

CALGARY — The chief executive of pipeline firm Enbridge Inc. (TSX:ENB) says oilsands bitumen should be processed in Alberta only if it makes economic sense for producers to do so, despite worries over jobs and investment being lost to the United States.

“The market really decides where that upgrading is best located,” Pat Daniel said.

“And generally speaking you’re better off getting the crude as close to market as you can before you upgrade economically.”

Alberta’s industrial heartland near Edmonton has been ailing as the recession has caused a slew of companies to delay or cancel the construction of the multibillion-dollar upgraders that convert thick, heavy bitumen into easier-to-refine synthetic crude oil.

There are concerns over whether those facilities will be built in Alberta once the economic storm clears, or if producers will instead opt to process their raw product in the United States, where several refineries are being revamped to handle oilsands crude.

So far it appears new developments planned by Imperial Oil Ltd. (TSX:IMO) and Suncor Energy Inc. (TSX:SU) will look at a U.S. bitumen processing strategy rather than upgrading in Alberta.

The Alberta government is in the process of reviewing ways to make the province more competitive with other jurisdictions.

Daniel wants a national energy strategy that “will trump partisan politics and poll-driven short-termism.”

Such a strategy would guide the country toward incorporating more renewables into its energy diet, but would at the same acknowledge the oilsands’ vast resources will be needed to meet the globe’s energy needs into the foreseeable future.

“The oilsands are the second biggest oil reserve in the world. We can’t deny access to the world of that huge source of energy,” Daniel said in the interview.

“And so we’ve got to come up with a way in which we develop that is in sync with green house gas emissions and environmental plans.”

In his speech in Edmonton, Daniel also emphasized the need for Canada’s energy industry to broaden its export markets.

Canada is currently the No. 1 oil supplier to the United States, but emerging Asian economies also present a lucrative market for Canadian crude as well.

Enbridge has proposed a crude pipeline called Northern Gateway that would stretch from the Edmonton area to the port city of Kitimat, B.C., where the oil would be loaded onto massive tankers and travel across the Pacific Ocean to Asia.

“I think that that’s kind of Economics 101 … you want to have as broad a market as you can so that if one customer quits taking your product, you’ve got other alternatives,” Daniel said.

“We’ve never had a West Coast alternative for Canadian crude oil and I think we badly need that to make sure that Canadians are getting the full pricing that they can for every barrel of crude that they sell.”

Just Posted

Walk raises awareness, money for overdose awareness in Red Deer

More than 90 people gathered in Red Deer to break the stigma… Continue reading

Ponoka RCMP looking for missing man

Ponoka RCMP is asking the public to help find a man who… Continue reading

Woman killed in collision west of Rocky Mountain House

A 42-year-old woman is dead after a two-vehicle collision in Clearwater County… Continue reading

Rough camper “tree house” found hidden in Red Deer woods

“This took a bit of work,” says man who discovered it

Central Alberta has one less peacekeeper with death of Nobel Prize-winning vet

The late Wayne Coubrough and Wayne Bevis helped diffuse tensions in the Middle East

WATCH: Snakes, lizards and more at the Western Canadian Reptile Expo in Red Deer

The 10th annual Western Canadian Reptile Expo is this weekend in Red… Continue reading

Your community calendar

Tuesday and Sept. 3 The Tony Connelly Singers provide an opportunity to… Continue reading

Central Alberta Bucs fall to Calgary Wolfpack in crazy AFL Championship game

The Central Alberta Buccanneers came up just short in pursuit of their… Continue reading

Regina police officer charged with impaired driving after hit-and-run

Regina police say a member of the force has been charged after… Continue reading

Groups ready campaign to help young voters identify ‘fake news’ in election

OTTAWA — Samantha Reusch is aiming to help young Canadians identify misinformation… Continue reading

Trade to dominate Trudeau-Trump bilateral meeting during G7 summit

BIARRITZ, France — Prime Minister Justin Trudeau arrived Friday for this weekend’s… Continue reading

Brazil military begins operations to fight Amazon fires

RIO DE JANEIRO — Backed by military aircraft, Brazilian troops on Saturday… Continue reading

Economic storm clouds hovering over Trump and global leaders

BIARRITZ, France — Under the threatening clouds of a global economic slowdown,… Continue reading

‘Red flag laws’ offer tool for preventing some gun violence

After a white supremacist discussed plans on Facebook for a mass shooting… Continue reading

Most Read