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Update-Refinery Drop wont hurt CA crude Enbridge says

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    basil parmesan

    Refinery Drop Won’t Hurt Canada Crude, Enbridge Says (Update1)
    By Jordan Burke
    Dec. 17, 2009 (Bloomberg) Enbridge Inc., the biggest shipper of crude oil from Canada’s oil sands, said a drop in U.S. refinery capacity will reduce water-borne oil imports instead of pipeline shipments from Canada.
    Enbridge hasn’t seen volumes decline as U.S. refinery operations slow, Chief Executive Officer Patrick Daniel said in a telephone interview. Calgary-based Enbridge benefits from being connected directly to landlocked refineries in the Midwest.
    “We haven’t seen a decline in volume on the system at all,” Daniel said. “It’s a long ways from water. Being an inland market and being directly connected to the largest, lowest-cost pipelines system in the world, it makes it very attractive to take Canadian crude.”
    Refinery utilization is 80 percent of capacity, the Energy Department said today, down from 84.7 percent a year ago. The drop in refinery use follows declining demand for oil products including gasoline and diesel fuel.
    In November, crude-oil imports to the Midwest rose 17 percent, from the previous year, to 1.36 million barrels a day. Over the same period, imports to the East Coast and Gulf Coast where most Middle East cargos arrive, fell 22 percent and 19 percent, respectively.
    “Its fair to say that Canadian crude will continue to flow, and it will probably be more of the water-borne Middle Eastern crude, with slowing U.S. demand, that would be impacted before Canadian crude would be,” Daniel said.
    Refinery Closure
    In November, Valero Energy Corp. announced plans to permanently shut its Delaware City, Delaware, refinery, and Sunoco Inc. idled its refinery in Westville, New Jersey. Western Refining Inc. announced plans to close its Bloomfield, New Mexico plant.
    Enbridge operates 8,500 miles (13,700 kilometers) of pipelines from the Alberta oil sands to Cushing, Oklahoma, delivering more than 2 million barrels of crude and related products a day.
    Enbridge fell 41 cents to C$48.21 on the Toronto Stock Exchange. The shares have risen 22 percent this year.
    To contact the reporter on this story: Jordan Burke in New York at Last Updated: December 17, 2009 16:27 EST

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