Canada Importing More Refined Petroleum Products

---

Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Since 2010, Canada's imports of refined products like gasoline and jet fuel have roughly tripled, supported largely by the need to dilute the thick type of oil found in Alberta, the nation's energy regulator said.

With 168 billion barrels of estimated oil reserves, Canada ranks fourth in the world, behind Iran, Saudi Arabia and Venezuela. Most of that is in Alberta, which reported a record average last year of 3.73 million barrels per day (BBL/d) in production.

But because some parts of the country lack the necessary infrastructure, Canada remains a net importer of refined petroleum products (RPPs) such as gasoline and jet fuel even though its refineries produce more than the nation can consume.

In a market snapshot published Wednesday by the Canadian Energy Regulator, data show Canadian imports of RPPs averaged 429,000 BBL/d last year, a 10% decline from prior-year levels.

"Generally, RPP imports have not yet returned to pre-pandemic levels," the government said. "Nevertheless, since 2010, Canada's imports of refined products like gasoline, diesel, heating oil, jet fuel, and condensate have roughly tripled, largely due to the increase in condensate imports into Alberta."

Lighter hydrocarbons such as condensate play a major role in the crude oil stream in western Canada because it can be used as a diluent for the heavy crude oil found in Alberta and elsewhere in the region.

Imports into Alberta come from the Southern Lights and Cochin pipelines from the United States. Volumes through those lines have climbed from 18,000 BBL/d in 2010 to 197,000 BBL/d last year. Most of what comes into Alberta is condensate.

"The condensate is blended with bitumen extracted from oil sands projects, allowing it to flow through pipelines," the government explained.

Canada as a whole gets the bulk of its light hydrocarbons from the United States, which averaged 330,000 BBL/d last year to account for 78% of total imports. That level, however, marked a 13% decrease from 2022.

The Netherlands was a distant second at 30,000 BBL/d, accounting for 7% of the total in 2023. The government stressed that no imports of refined petroleum products came from Russia last year due to war-related sanctions, though those imports typically accounted for only around 2% of the nation's total at best.

In terms of unrefined products, most of the crude oil exported from Canada goes to either the U.S. Gulf Coast or to the U.S. Midwest. Over the four-week period ending June 7, Canada delivered an average of 3.7 million BBL/d worth of crude oil to the United States, a 5.4% increase from the same period last year.

That level suggests there will be no major supply disruptions for the United States after Canada broke out of its North American landlock through the expansion of the Trans Mountain crude oil pipeline.

Flows began in May and vessels are already parked off Vancouver to take on Trans Mountain cargo.

Approved in 2019, the expansion twinned the existing 714-mile pipeline that runs from Alberta. Nominal capacity on the system expanded from 300,000 BBL/d to 880,000 BBL/d.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).