Valero Energy Corp. and Chevron Corp. are acquiring oil shipped through the newly expanded Trans Mountain Pipeline system for their California refineries. This indicates that the U.S. West Coast could become an important market for oil-sands crude.
In June, cargoes of Cold Lake crude, a heavy grade from the oil sands, will be loaded onto Aframax tankers at the Westridge Terminal near Vancouver. This information comes from anonymous sources. Chevron and Valero have not immediately responded to requests for comment via email.
These are the first sales from the expanded pipeline to Western U.S. refiners. Previous sales have been made to China’s Sinopec Group and Sinochem Group for delivery to Asia.
The Trans Mountain expansion, which will nearly triple the capacity of the only oil pipeline system from Alberta to Canada’s Pacific Coast, is set to begin commercial operation on May 1 after years of construction delays and cost overruns.
The new pipeline was intended to reduce Canada’s heavy reliance on U.S. refiners by providing access to Asia. However, some analysts believe that U.S. West Coast refineries may become the preferred market due to proximity and the small size of Aframax tankers that can reach Vancouver.
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The primary producers of Cold Lake crude are Imperial Oil Ltd., a unit of Exxon Mobil Corp., as well as Cenovus Energy Inc. and Canadian Natural Resources Ltd., according to Crude Oil Monitor.
