Imports of gasoline, diesel and jet fuel to the Lower Mainland increased significantly over the first half of 2018, helping to pad record cargo volumes through Vancouver’s port for the period, according to the Port of Vancouver.
Oil exports have increased in 2017 and the first half of 2018 from record lows in 2016, said port CEO Robin Silvester, but it was imports that drove its increase in cargo volumes.
“We’ve seen a 1.2-million-tonne increase (in petroleum shipments), and within that, 900,000 tonnes or so is inbound rather than outbound,” Silvester said, “and the inbound is almost all stuff we use as consumers.”
The port’s oil exports flow from Kinder Morgan’s Westridge Marine Terminal, which can also handle imports, but the port also has a handful of other import terminals, including the Parkland (formerly Chevron) oil refinery and nearby Shellburn terminal in Burnaby, and the Suncor and Ioco terminals in Port Moody.
Silvester said import and export volumes vary depending on market conditions and prices at the time shipments are made, but generally demonstrate how dependent the region still is on fossil fuels.
“In the absence of the Kinder Morgan (Trans Mountain pipeline expansion), what we’re observing is fluctuations of the local part of a global market that is mainly to do with consumption in the Lower Mainland,” he added.
Exports of petroleum products were also up 300,000 tonnes, Silvester said, with about half flowing to other domestic locations, such as Vancouver Island, and the other half as mostly crude oil to foreign ports.
Two tankers went to Asian destinations, one to Korea and the other to China, but most flowed to California refineries thirsty for new feed stocks to replace declining supplies from Alaska and attracted by relatively cheap Canadian heavy oil.
“Today, the majority of shipments leaving our Westridge Marine Terminal are going to the U.S.,” said Lizette Parsons Bell, a spokeswoman for the Trans Mountain expansion, in an emailed statement.
“The mix of products and destinations varies from year to year and is based on market demand,” said Parsons Bell.
An independent economist, Robyn Allan, said current market conditions make it attractive for California refineries to tap what they can from the over-subscribed Trans Mountain pipeline.
“It is a function of the fact it is relatively cheap,” said Allan, with the key Canadian heavy-oil grade selling at a US$26-a-barrel discount to the benchmark West Texas Intermediate crude price of US$64.89 a barrel.
In 2017, according to the Port of Vancouver, the port shipped 1.8 million tonnes of oil, or 12.6 million barrels, compared with 1.2 million tonnes, or 8.5 million barrels, in 2016.