Cenovus Power is sending a cargo of crude oil down by way of the Panama Canal as a part of its first-ever transaction with New Brunswick’s Irving Oil.
The oil cargo will make the 11,900-kilometre journey to Irving’s refinery in Saint John by tanker ship, Cenovus introduced in a social media put up on Wednesday.
The information comes two months after Irving Oil, the operator of the nation’s largest refinery, stunned the sector with its plans to start receiving extra crude from Western Canada by utilizing tankers beginning this summer season.
Cenovus vice chairman Keith Chiasson stated in a press release supplied to CBC Information that it is a “one-off “cargo for now.
“However we consider this Canadian success story has the potential over time to create vital worth for each corporations and your complete nation,” he stated, including Cenvous is happy with the economics of the transaction.
Privately held Irving utilized this spring to the Canadian Transportation Company (CTA) to make use of international tankers with a purpose to improve the quantity of home crude it will get from offshore Newfoundland and Western Canada.
Iriving Oil’s utility included a proposal for the tankers to move oil from a terminal in Burnaby, B.C., by way of the Panama Canal and on to Irving Oil’s refinery in Saint John, N.B.
The corporate stated in the beginning of Might that it needed to improve the mixture of Canadian crude it makes use of, which at the moment was within the vary of 20 per cent.
Rising the quantity of Canadian oil that the refinery makes use of would displace the crude imports the corporate will get from around the globe, but it surely wasn’t clear which shipments may be affected.
An official with the refinery stated on the time that it makes use of a “vital” quantity of oil from the United States.
The Alberta authorities has welcomed Irving Oil’s curiosity in utilizing extra Western Canadian crude, however has additionally stated it was “unlucky” it required sophisticated marine transport routes somewhat than a pipeline, just like the cancelled Power East pipeline.
Chiasson stated the transaction reveals the flexibility of the 2 corporations “to assist drive Canada’s financial system even throughout these unprecedented occasions of turbulence created by the COVID-19 pandemic and the ensuing challenges for the power business.”