Irving applies to use foreign oil tankers to ship Canadian crude to Saint John
SAINT JOHN, N.B. -- With the price of Canadian crude at or near historic lows, Irving Oil has plans to tap into that supply for the Saint John refinery, but some eyebrows have been raised over how they plan to bring the crude to New Brunswick.
For years, rail cars carrying cheaper oil from Western Canada and the U.S. have been a regular feature on the tracks heading into Saint John.
Irving Oil wants to ship more Canadian crude to its Saint John refinery, but wants to use a new method.
The company applied to the Canadian Transportation Agency for permission to use foreign oil tankers to transport Canadian crude from three directions:
- from a West Coast terminal, down to the Panama Canal, and then to Saint John.
- from terminals on the U.S. Gulf Coast, and then to the Bay of Fundy, and;
- from suppliers in Newfoundland and Labrador.
In a letter to the federal authority, Irving described what it calls a crisis in both the Canadian economy and energy industry.
It says: “As a Canadian company who owns and operates Canada’s largest oil refinery, Irving oil should have access to Canadian crude oil from both offshore Newfoundland and Western Canada.”
Irving says the COVID-19 pandemic has created significant uncertainty in supply chains. The company describes the situation as urgent.
Environmentalists, however, are concerned about moving too fast with the plan.
"We're watching them closely to make sure that companies like Irving don't take the opportunity to expedite and move forward with things they want to do without the level of environment oversight that they'd usually see," said Matt Abbott of Fundy Baykeeper.
The company says it wants to increase the use of domestic oil at its refinery.
“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.”
Irving says Canadian-owned tankers are not available at this time.
No one can predict how long the price of Canadian crude will be at rock bottom, or how long it will remain a bargain for buyers.
The Irving Oil application to move that oil to Saint John using marine tankers starts this month and ends in one year, in April of 2021.