February 21, 2024 – Reuters
Trans Mountain expansion may not give long-term price relief to Canada's booming oil output
By Nia Williams
Most of the new capacity on TMX will be for heavy crude barrels, meaning light and synthetic crude oil is most likely to face rationing on the Mainline and any resulting price discounts, said RBN's King.
The new capacity on TMX will give heavy crude producers a choice of sending barrels to the U.S. west coast and Asia, or to the U.S. Midwest and Gulf Coast on existing pipelines.
On a recent earnings call, Imperial Oil, opens new tab CEO Brad Corson said having spare pipeline capacity would lift the value of heavy crude for the entire Canadian oil industry.
Imperial will continue to move most of its barrels to the Midwest and Gulf Coast, while keeping a look out for the highest-value markets, he added.
Ryan Bushell, president of Newhaven Asset Management, which holds shares in pipeline companies including Enbridge, said TMX would likely run at less than full capacity if strong pricing on the Gulf Coast, the world's largest heavy crude refining centre, drew barrels onto pipelines heading south.
Read the full article here: https://www.reuters.com/business/energy/trans-mountain-expansion-may-not-give-long-term-price-relief-canadas-booming-oil-2024-02-21/
