Industry Claims Tanker Ban Will Impede Montney Light Oil Production
Canadian petroleum producers are pushing back against the federal government’s new ban on tankers off British Columbia’s northern coast, saying it threatens economic activity in the province’s northeast.
The area has seen booming activity in development of the Montney natural gas field. Ottawa has approved other elements of infrastructure to bring that gas to the B.C. coast and ship it abroad, and its proposed ban on large tankers carrying crude oil, bitumen, or bunker fuel explicitly exempted those loaded with liquefied natural gas, gasoline, or jet fuel.
Like this story? Subscribe to The Energy Mix and never miss an edition of our free e-digest.
Nonetheless, the Canadian Association of Petroleum Producers (CAPP) complains that “the proposed moratorium could significantly impair Canada’s oil and natural gas resources from reaching new markets and ensuring Canadians receive fair market value for its resources,” JWN Energy reports.
CAPP claims the draft order goes further than the expected ban on crude oil tankers with a prohibition on “persistent oils”. That category includes “condensate, a type of lighter oil that is used to dilute the heavier bitumen produced in Alberta’s oilsands, which has become the single most important oil product being produced in B.C.’s Montney play,” JWN explains.
As a result, the industry lobby group asserts, the “export of emerging light, tight oil resources off the West Coast could be at risk, going beyond the original intent of the federal government when it first announced the moratorium.”
The seriousness of that limitation is put into question however, by a recent move by Calgary-based Enbridge Inc., reported earlier this month in the Financial Post. The company will spend $1 billion adding compressor stations to an existing pipeline to increase its throughput of Montney hydrocarbons to the Vancouver area, avoiding the province’s northern coast entirely.