Greater market choice would retain jobs and expertise in Ontario
More stable oil prices will encourage additional exploration and
development in Ontario
OPI confident Enbridge will continue to operate Line 9B to the highest
safety and environmental standards
TORONTO, Oct. 17, 2013 /CNW/ - The Ontario Petroleum Institute, which
represents Ontario light crude oil producers, appeared before the
National Energy Board today in Toronto to explain why the reversal of
flow of Enbridge's Line 9B is crucial for the future growth of the
province's oil production industry.
"The reversal of Enbridge's Line 9B would offer Ontario producers an
enhanced competitive market in Canada for current and future
production," said Jim McIntosh, a petroleum engineering consultant and
a member of the Ontario Petroleum Institute's Board of Directors. "The
approval of Line 9B provides an option that enables oil produced in
Ontario to be transported to Canadian refineries outside of the Sarnia
region at a cost differential superior to road, rail and water."
In his presentation to the National Energy Board, Mr. McIntosh explained
that significant increases in North American oil production have
resulted in dramatic changes in the market and specifically to the
prices received by Ontario producers. Oil prices have been discounted
up to 20 per cent lower than the benchmark set for oil by the price of
West Texas Intermediate (WTI) and Brent crude oils.
To remain viable contributors to the Ontario economy, the producers'
ability to market its current and future production is an important
priority. This has prompted Ontario producers to look for an
alternative market for oil.
"The logical and practical choice for an alternative market for Ontario
oil production would be to refineries in Montreal and Saint John," said
Mr. McIntosh. "This option is practical only if pipeline delivery is
available. The reversal of Line 9B provides that availability to
Mr. McIntosh added: "Having this new transportation choice helps remove
any bottlenecks created by oversupplies at Sarnia. Additional refinery
options for oil volumes at Sarnia will firm up the price."
The Ontario Petroleum Institute strongly believes the Line 9B reversal
project will create jobs in the province and advance Ontario's oil
"The collateral benefit for the Ontario oil and natural gas industry
will be the skilled jobs required for the reversal of Line 9B, most of
which are transferable to the Ontario producers," said Mr. McIntosh.
"The reversed system will increase marketing alternatives for local
producers, ensuring they will receive prices that more closely reflect
oil prices in other parts of North America. Oil prices that are more
stable will encourage additional exploration and development in
Ontario, and the jobs created by that activity."
Regarding pipeline safety, Mr. McIntosh told the National Energy Board
that its members have been safely using pipelines in gathering and
transporting oil for more than 100 years.
"The Ontario Petroleum Institute fully expects Enbridge to meet its
responsibilities and commitment to operating Line 9B to the highest
standards to ensure the health and safety of the communities along the
route and in the surrounding areas of the route."
About the Ontario Petroleum Institute
The Ontario Petroleum Institute is a non-profit industry association
which represents explorationists, producers, contractors, geologists,
petroleum engineers and other professionals, individuals or companies
directly related to the oil and natural gas, hydrocarbon storage and
solution mining industries of Ontario. Fundamental objectives of the
Institute are: to encourage responsible exploration and development of
the oil, natural gas, hydrocarbon storage and solution-mining
industries in Ontario; to maintain close liaison with government
agencies which regulate the industry; to disseminate information
relevant to member needs; to promote the legislative goals of the
membership and to inform and educate the general public on the
significance of the industry to the province of Ontario. www.ontpet.com.
SOURCE: Ontario Petroleum Institute
For further information:
For interviews and more information:
Executive Director, Ontario Petroleum Institute
Tel: (519) 630-4204