New Brunswick

Many countries like to talk about energy independence, but Canada is one of the few to come close to that elusive goal. For many years, Western Canada has produced more than enough crude oil to satisfy the demand of refineries in the region. More recently, a combination of rising Western Canadian oil production, and new and reworked pipelines, has enabled many of Canada’s eastern refineries to increase their intake of Western Canadian barrels. In the few remaining cases where they can’t, imported barrels from the U.S. have filled the gap, leaving crude imports from overseas accounting for just 1% of the market. Not surprisingly, Canada is also a net exporter of refined products, with refiners in Western Canada, and especially Atlantic Canada, producing far more than the country’s demand. Today, we conclude our series on Canada’s refining sector with a look at its growing reliance on Western Canadian crude oil and its ability to meet most of Canada’s need for gasoline and distillates.

The shutdown of natural gas production from the Sable Offshore Energy Project on Canada’s East Coast as of January 1, 2019, increased the Canadian Maritimes’ reliance on gas exports from New England this winter as consumers worked to link up with fresh supply to replace SOEP. The tightening supply in the region has prompted expansion plans from TransCanada to move more Western Canadian and Marcellus/Utica gas to New England utilizing its Mainline and other eastern systems. Today, we conclude our series examining the potential impacts of SOEP’s demise by examining new plans to bring more gas to the region. 

After 19 years of natural gas production from the waters off the Canadian Maritime provinces, ExxonMobil, operator of the Sable Offshore Energy Project (SOEP), shut down production there, effective January 1, 2019. The closure further limits gas supply options for the already supply-constrained Maritimes and New England regions. Will the shutdown put even more stress on the already overtaxed gas pipeline system in New England? And will it spur increased flows of Western Canadian gas into northern New England and Canada’s Maritime provinces? Today, we continue our series examining the potential impacts of SOEP’s demise on New England gas markets.

After 19 years of natural gas production from the waters off the Canadian Maritime provinces, ExxonMobil, operator of the Sable Offshore Energy Project, shut down production there effective January 1, 2019. Though the closure had been announced well in advance, the end of SOEP output has left the two natural gas-consuming provinces in the region, New Brunswick and Nova Scotia, without any indigenous gas supplies. It’s also made them fully reliant on either pipeline gas from the U.S. Northeast and Western Canada or imported volumes of LNG into the Canaport Energy terminal in New Brunswick. Will the shutdown put even more stress on the already overtaxed gas pipeline system in New England? And will it spur increased flows of Western Canadian gas into northern New England and the Maritimes? Today, in Part 1 of this blog series, we begin an examination of the potential impacts of SOEP’s demise on New England and Eastern Canadian gas markets.