On Tuesday Aug. 11, 2015 there was a CAN$144/bbl difference between gasoline at about CAN$1.10/litre, which is CAN$175/bbl, and the benchmark Western Canada Select (WCS) price for raw bitumen as dilbit at CAN$30.55/bbl.

 
That huge difference is the margin available to build and operate refineries like the North West upgrader/refinery (cover photo, Ian MacGregor, Chairman of the Board, Pres. & CEO, North West Upgrading, Inc.) under construction near Edmonton, and to provide for domestic jobs, profits, and taxes.
 
Albertans wisely committed some bitumen royalty-in-kind (BRIK) volumes as feedstock to the refinery - a terrific hedge against low oil prices, and back-stopped its financing with a guarantee of fees.

Obviously, oil companies are currently making huge profits refining. The U.S. EIA reports that inputs to U.S. refineries exceeded 17 million bbl/d in each of the past four weeks, a level not previously reached since 1990.

 

Alberta bitumen priced at Tuesday’s WCS benchmark of U$23.31/bbl is by far the cheapest feedstock available to U.S. refineries.

 

By sending 1.4 million bbl/d of raw bitumen to U.S. refiners, Albertans and Canadians are losing out on CAN$200 million per day, or CAN$73.5 billion per year, available to build and operate refineries and produce domestic jobs, profits and taxes. 

 

 

Mike Priaro, P.Eng.

Calgary, Alberta, CANADA 

403-281-2156

 

"Mike Priaro, B.Eng.Sc. (Chem. Eng.), U.W.O. '76, P.Eng., Lifetime Member Association of Professional Engineers and Geoscientists of Alberta (APEGA), worked in facilities, production, operations and reservoir engineering, as engineering consultant, area superintendent, and engineering management in Alberta's oil patch for 25 years for companies such as Amoco and PetroCanada.”

“He increased oil production from the historic Turner Valley oilfield and brought in under-balanced drilling and completion technology to drill out, complete, and test several of the highest producing gas wells ever on mainland Canada at Ladyfern.  He co-authored ‘Advanced Fracturing Fluids Improve Well Economics’ in Schlumberger's Oilfield Review and developed the course material for the ‘Advanced Production Engineering’ course at Southern Alberta Institute of Technology.”

"Mike has presented his work to Canada’s House Committee on Natural Resources in Ottawa and had work published by the Macdonald-Laurier Institute in the March and April, 2014 and February, 2015 editions of Inside Policy magazine, by U.S. energy industry websites such as RBN Energy, in the July 17, 2014 edition of the Oil and Gas Journal, in Petroleum Technology Quarterly, Q3 2014, and in several columns in the Calgary Herald, Edmonton Journal, and Montreal Gazette."

“Mike has no formal connection to any oil company, environmental organization, think tank, labour organization, lobbying or special interest group, academia, or to provincial or federal politics.  However, Mike was recently retained as consultant by Alberta Sulphur Research Limited to help advance its new partial upgrading process for bitumen."

“Mike is the author of  “A ‘Canada-First’ Canadian Energy Strategy” (see https://www.behance.net/portfolio/editor?project_id=5808629) and is available for special projects and speaking engagements.”