* 550,000-bpd plant would be built at Kitimat, BC
* David Black says would remove heavy crude spill threat
* Says could be financed by equity, debt
* Enbridge will not comment
By Jeffrey Jones
CALGARY, Alberta, Aug 17 A British Columbia
newspaper publisher is proposing a C$13 billion ($13.2 billion)
refinery on Canada's West Coast to process all of the
oil-sands-derived crude that would flow through Enbridge Inc's
contentious Northern Gateway pipeline from Alberta.
Enbridge, however, had little to say about the ambitious
pitch by David Black, owner of Black Press Ltd, as the pipeline
company prepared for the start of the formal part of the
Northern Gateway regulatory hearings next month.
Black said on Friday that the huge plant would process up to
550,000 barrels a day of crude at a site near Kitimat, British
Columbia, the terminus of the proposed C$6 billion Northern
Gateway. That would make it the biggest refinery in the country.
It would allow British Columbia to share more of the
economic benefits of Northern Gateway by creating 3,000
full-time jobs and 6,000 construction jobs, said Black, who
acknowledged he is no refining expert but has mulled such a
proposal for seven years.
Black Press runs 150 newspapers in Canada and the United
States, including the Beacon Journal in Akron, Ohio; the
Honolulu Star-Advertiser and the Advocate in Red Deer, Alberta.
British Columbia Premier Christy Clark caused a stir last
month by saying her government will not support the pipeline
that would cross the mountainous province unless British
Columbians can get more money to compensate for the
Besides offering economic benefits, Black said a refinery
targeting Asian markets would remove any threat of a heavy crude
spill on Canada's West Coast, a major worry among
environmentalists and native groups opposed to Northern Gateway.
Enbridge declined to comment other than to say it remains
committed to the regulatory process for reviewing Northern
Gateway, which would move 525,000 barrels a day over the
1,177-km (731-mile) route.
Black's plan is the latest twist in the Northern Gateway
saga that has pit governments against each other, riled many
aboriginal communities in British Columbia and dominated
headlines in Canada. Under current plans, tankers would take the
diluted bitumen from an oil port at Kitimat and ship it to
California and across the Pacific.
The oil industry and governments of Canadian Prime Minister
Stephen Harper and Alberta Premier Alison Redford see opening
Asia to tar-sands-derived oil as key to diversifying markets and
boosting economic returns, which are held back by a glut of
supplies in traditional U.S. Midwest destinations for the crude.
Black's new company, Kitimat Clean Ltd, has briefed
governments on the plan and will submit an environmental
assessment application, he said.
The plant would produce 240,000 barrels a day of diesel,
100,000 of gasoline and 50,000 of kerosene or aviation fuel.
Construction would start in 2014 and take six years.
He said he has analyzed his proposal with investment bankers
and concluded that projected revenues and profit would be large
enough to enable equity and debt financing.
The petroleum products would be marketed throughout the
Pacific Rim, with China being a main target, Black said in
remarks posted on the company's website. The company would offer
investment opportunities to Chinese buyers.
"If China is not interested there will be other buyers. A
Kitimat refinery will be a compelling opportunity for any
country that has to import oil," he said. "It will offer a
guaranteed long-term refined fuel supply at a competitive price
from a new diversified source."
The last refinery built in Canada was Royal Dutch Shell's
Scotford plant in Alberta in 1984.