Cenovus first to announce it’s shipping Western oil to Eastern refineries through the Panama Canal

“It’s encouraging to see more Canadian-produced oil refined at a Canadian refinery. It’s a one-off shipment for now, but we believe this Canadian success story has the potential over time to create significant value for both companies and the entire country,” Chiasson said.

Irving Oil did not respond to a request for comment on how many Canadian oilsands producers have agreed to ship oil to its 320,000-barrels-per-day refinery in Saint John, the largest such facility in Canada.

Irving was a backer of the cancelled $15-billion Energy East pipeline project, which Calgary-based TC Energy Corp. had proposed to connect Alberta’s oil to ports in Quebec and ultimately to the Saint John refinery and port on the Atlantic Ocean. The project was cancelled in 2017 after sustained opposition by environment and local groups, apart from the governments of Ontario and Quebec. Irving had committed to co-invest in an expanded port facility connected to its refinery if the project had proceeded.

In May, Transport Canada approved Irving’s application to use foreign ships to source Canadian oil shipments for its refinery in New Brunswick, a move which surprised many analysts in the oil industry as it suggested the circuitous route through the Panama Canal was economically feasible.

Irving plans to source Canadian oil from the Burnaby terminal along the U.S. Gulf Coast. The Trans Mountain Expansion, ending in British Columbia, and Keystone XL pipeline, weaving its way to the Gulf Coast, are both under construction and — once built — could dramatically boost Alberta’s oil shipments to eastern Canada.

On May 28, Irving said it would purchase the only refinery in Newfoundland and Labrador at Come By Chance and called the transaction a “building block” in a larger strategy to source and process more Canadian oil.

“Our recently announced plans to source Canadian crude oil and today’s announcement in Newfoundland are two building blocks that fit together with our company’s existing strengths,” Irving spokesperson Candice MacLean said in an email when the refinery deal was announced. “All of these elements contribute to our long-time objective of helping Canada be even more competitive in the international landscape.”

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