Cashing in on Canada's tar sands: oil transporters
Which companies are profiting from oil sands transport operations? Major movers include Enbridge, TransCanada and Kinder Morgan. Second in our series exploring who has the highest stakes in the oil sands.
According to the Canadian Association of Petroleum Producers (CAPP), 79 per cent of the world’s oil reserves are controlled by national governments. Out of the 21 per cent left accessible to private industry, more than half is located in Alberta’s oil sands.
Prime Minister Stephen Harper and his administration insist that exploiting the oil sands is necessary and beneficial to our country’s long-term economic health. But for the average Canadian, it can be tough to see exactly where these benefits lie.
So what are the corporations, businesses and individuals with big stakes, who stand to gain from tar sands operations? And how much are they worth?
Part one of this series focused on the top oil extractors in Fort McMurray and how much they’re raking in each year. Now, we take a look at some of the corporations with high stakes in other areas.
Oil transport and pipeline operators
Now that we know who’s responsible for extracting the oil product, we can move on to some of the other key players needed to get it to market. Getting it to market first means transporting oil and raw bitumen from the tar sands mining operations, and that generally means constructing pipelines that can carry it.
North American pipeline map courtesy of the Canadian Association of Petroleum Producers (CAPP).
As you may have guessed from the ongoing Keystone XL and Northern Gateway pipeline controversies, Enbridge and TransCanada are the two most well known companies working to transport tar sands oil to international clients.
Enbridge operates a network of pipelines running southeast to terminals and refineries across the United States and southern Ontario. Their proposed Northern Gateway pipeline would cut across northern British Columbia, serving a coastal port in Kitimat that would transport tar sands products to Asia.
Enbridge’s total revenues for 2010 reached $15.1 billion. Financial reports show net earnings of up to $963 million for the year, with $512 million from oil pipelines alone.
TransCanada is another major winner in the oil sands industry, even though their primary operations are in natural gas transportation. Growing production out of the oil sands has prompted company executives to put more weight behind expanding oil and liquids systems, and the major result of this push was the Keystone project.
The existing Keystone pipeline runs from Alberta south to Nebraska, Oklahoma and Illinois. With Keystone XL, TransCanada hopes to expand operations to reach the Gulf Coast.
Net income for TransCanada was over $1.2 billion in 2010, although not all of that can be attributed to tar sands operations. With their combined ownership of natural gas and oil pipelines, the company reports a $47 billion asset base.