(Bloomberg) – A Canadian oil producer is pitching a new port on the northern British Columbia coast to ship as much as 250,000 bpd of crude, a proposal that requires an exemption to a federal tanker ban.
Strathcona Resources Ltd. plans to reach out to Prime Minister Mark Carney’s government as early as next week with a plan to ship crude by rail to a yet-to-be-built oil export terminal in Prince Rupert, B.C., said Adam Waterous, the company’s chairman.
Oil exports off the northern B.C. coast are controversial and opposed by many coastal Indigenous communities, environmental groups and B.C. Premier David Eby. Former Prime Minister Justin Trudeau implemented the moratorium in 2019.
Waterous is pitching the rail plan as a way to accelerate Carney’s goal of increasing crude shipments to customers other than the U.S., which takes about 90% of Canada’s oil exports.
“Why this is quite transformational for the country is we think that we could be shipping a quarter of a million barrels a day in under two years,” he said in an interview.
Carney in July decided to commission the state-owned Trans Mountain Corp. to build a new pipeline to the Vancouver area in southern B.C. and maintain the tanker ban. That pipeline won’t be operating before the early to mid-2030s. The volumes of crude shipped off Prince Rupert would amount to a near 50% increase from current Canadian oil shipped off the B.C. coast, all off the Trans Mountain pipeline.
The Canadian oil sands producer already ships as much as 80,000 bpd of its own and other companies’ crude south to the U.S. Gulf Coast via rail terminals Strathcona acquired in recent years in Hamlin, Saskatchewan, and Hardisty, Alberta, Waterous said.
Prince Rupert already includes much of the infrastructure needed for a crude export terminal since the port receives propane by rail, which is then exported off an existing terminal, he said. The possible new terminal would be able to receive the world’s largest oil tankers that carry more than a million barrels, Waterous said, adding that Indigenous opposition might be overcome through negotiations and partnerships.
“There is much work to be done, a lot of wood to chop, a lot of community engagement to advance,” he said. “The economics could be very compelling.”
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