Suncor might process Alberta bitumen in Montreal
Jason Franson,The Canadian Press
Suncor chief executive officer Steve Williams talks to shareholders before his speech at the company's annual general meeting in Edmonton on Tuesday.
By Lauren Krugel
CALGARY — A project that would enable Suncor Energy Inc.'s Montreal refinery to process thick, tarry oilsands bitumen from Alberta could get the green light later this year or early in 2015, CEO Steve Williams said Tuesday.
The Montreal coker project is just one way Suncor is looking to cut crude costs at the refinery, which has long relied on pricey overseas imports.
"I expect to have on my desk by the end of this year the proposal for the coker project, so we'll be in a much clearer position toward the end of this year, maybe beginning of next year, to decide whether we go ahead," Williams told analysts on a conference call to discuss Suncor's first-quarter results.
Suncor is not disclosing the estimated price tag of the coker project, but Williams says it will cost much less to be built in Montreal than in the cost-inflation prone northern Alberta market.As well, much of the required equipment is already in Suncor's hands, as an earlier iteration of the project was shelved years ago.
In the meantime, Suncor has been able to supply the 137,000 barrel-per-day facility with cheaper inland crude using rail and ship.
During the first quarter, about 20,000 barrels per day of Western crude made its way to Montreal by rail, with the expectation of hitting an average north of 30,000 barrels per day for 2014.
Suncor figures its rail strategy saved it $20 million during the quarter, since the Montreal refinery had access to cheaper inland crude, rather than having to rely on costlier imports.Some seaborne cargoes loaded with cost-effective U.S. crudes have also made their way to Montreal — an option Suncor uses on an "opportunistic" basis, Williams said.
By this time next year, Suncor says its Montreal refinery should be able to get 100 per cent of its crude from within North America — once Enbridge Inc.'s Line 9 pipeline between southwestern Ontario and Montreal has been reversed and expanded. That project won regulatory approval in March.
"We're delighted with the news around the Line 9 reversal and anticipate that line being reversed plus or minus a few months on the end of this year. We're just working through the specific schedules on it now."
The improved market access was one of the reasons behind Suncor's record and better-than expected first-quarter results, announced late Monday.