As Ottawa prepares to unveil its Clean Fuel Standard, industry warns of refinery shutdowns
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Refinery shutdowns are not a new phenomena in Canada, as Shell Canada’s Montreal East refinery closed down in 2010 and Imperial Oil Ltd. shuttered operations at its Dartmouth, Nova Scotia in 2013. This year, North Atlantic Refining Ltd. announced it would close Newfoundland’s only refinery at Come By Chance as the COVID-19 pandemic knocked out demand for consumer fuels.
But shutting down a refinery will lead to higher fuel costs for consumers and investment relocating elsewhere, said Dan McTeague, president and founder of Canadians for Affordable Energy and a former Liberal Party MP.
“I think it’s going to have a significant impact,” McTeague said, adding that he believes that even without refineries shutting down, “it’s going to cost you anywhere from 10 cents to 15 cents per litre of gasoline.”
While Alberta’s economy is the most dependent on the energy industry, markets such as Ontario and Quebec use more fuel and McTeague is expecting a larger impact in those markets given additional costs at refineries in the Sarnia region and in Quebec as refineries will scramble to source ethanol from the U.S.
In a recent speech before the Calgary and Edmonton chambers of commerce, federal Natural Resources Minister Seamus O’Regan said the CFS was not intended to target a specific industry but to reduce emissions at the point of consumption across the country.
If it’s not done right, we’re going to lose existing infrastructure
Bob Laracque, CEO, Canadian Fuels Association
However, the Alberta government has concerns about the soon-to-be unveiled regulations because many companies that will be listed as “fuel providers” are headquartered in Alberta, including oil companies that own refineries and fuel stations, as well as natural gas producers and electric utilities with gas-fired power plants.
