Trans Mountain pushed to alter specifications to help oil value
Bloomberg News
,Oil companies including Chevron Corp., Canadian Natural Resources Ltd. and Suncor Energy Inc. are pressing the operators of the expanded Trans Mountain pipeline to change certain key specifications to improve the value of the crude the conduit is carrying.
The drillers are asking Trans Mountain to lower the vapor pressure and acid levels of the crude it will allow to pass through the line, saying that the current limits are reducing the value of the oil that’s shipped and restricting where it can be refined. Trans Mountain, which is owned by the Canadian government, didn’t immediately respond to an email seeking comment.
The complaints are marring the startup of the pipeline’s long-delayed expansion, which almost triples the volume of crude that can be shipped from Alberta to the Pacific Coast. Oil producers already had been upset by the high tolls they’re being charged to use the line — partly a result of construction setbacks that caused the project’s price tag to balloon sixfold to US$34 billion — and are arguing the shortcomings should allow them to pay less.
Chevron, a buyer of crude off the line, said in a letter filed with the Canada Energy Regulator Friday that the vapor pressure limit exceeds U.S. Environmental Protection Agency caps on storage tanks at California refineries. Chevron operates two refineries in the Golden State, and a failure to amend the pressure and acid limits may prevent it from purchasing or processing crude from Trans Mountain for those facilities.
Oil-sands giant Suncor said in a regulatory filing that the high vapor pressure limit means companies will blend lower value hydrocarbons with the crude that is injected into Trans Mountain, reducing the value of the oil shipped on the line, .
The pressure specifications carry the “real potential of altogether eliminating entire markets for Suncor,” the Calgary-based company said.
No comments:
Post a Comment