Cashing in on Canada’s tar sands: refineries and other industries

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 which 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 part two looked at companies transporting the product through major pipeline systems. Now, we take a look at some of the companies with high stakes in other areas.

Oil upgraders and refineries

While there is some conventional oil extracted from the tar sands, the region’s primary oil product is bitumen. Bitumen is a heavy, viscous type of oil that must be treated before it can be turned into usable fuels like gasoline and diesel.

Before even reaching the refinery, the bitumen goes through an upgrading process that adds hydrogen to the carbon substance and removes contaminants like sulfur and nitrogen. Then, once the product has been upgraded (and diluted), it can be transported via pipelines to refineries across North America.

The most prominent energy companies working on extraction in Alberta also operate upgrade and refining facilities. According to the Alberta Energy website, there are currently five upgraders in the province, operated by major producers like Suncor, Syncrude and Canadian Natural Resources Ltd.

Suncor, one of the oldest and most profitable tar sands extractors, also operates refineries in four different locations, processing oil sands crude into refined products to serve markets around North America. Its major refinery in Edmonton, Alta., runs entirely on oil sands crude, and it has other refineries in Quebec, Ontario and Colorado. In fact, the Colorado Suncor plant recently came under fire for a spill leaking petroleum products into creeks near the South Platte River.

Imperial Oil operates another refinery in Strathcona, Alberta – though it is run on conventional oil rather than oil sands crude.

The third major refinery in Alberta is operated by Shell Canada, and according to its website, it was the first to exclusively process synthetic crude from oil sands products.

A large proportion of upgraded tar sands product also ends up in the United States, where other oil and gas companies operate their own refineries. Many of these are located at key points connected by the major pipeline systems, in places like Illinois, Montana, Ohio and Utah.