Western Canada Refining

Petroleum Productsin Western Canada

•Esso, Shell, PetroCanada in Edmonton – 400 Mbd

•ChevronTexaco in Vancouver – 50 Mbd

•Husky in Northern BC – 10 Mbd

•Co-op in Saskatchewan – 70 Mbd

•All run light sweet crude and/or synthetic

North American Pipelines,Refinery Centres and US Markets

Western Canada Product Balances

•Mogas

–Balanced or short in summer

–Long in winter

•Diesel

–Generally long or balanced all year

–Syncrude plants now making diesel, will increase length

•Jet

–Short jet, significant volume to diesel for pour in winter

–Significant portion of Vancouver airport supplied by imports

Trans Mountain Pipe Line (TMPL)

•Ships crude, products and MTBE/isooctane insingle line

•Capacity about 240,000 bpd, typically not full *

•Crude goes to Vancouver, Puget Sound refiners,export

•Mogas and diesel to supply Southwestern BC,export

•MTBE to California, will be replaced withisooctane

System Map

Influences on TMPL Throughput

•Puget Sound refiners demand for Canadian crude

–Depends on price vs. ANS

•Exports of crude from TMPL’s Vancouver terminal

–Heavy crude reduces capacity

•Turnaround activity at Edmonton refineries

–BC supplied by imports, reduced shipments ex Edmonton

•Significant increase in synthetic crude in Alberta

–May look to export some via West Coast

•TMPL could “dust off” expansion plans if capacityconsistently constrained.

Canadian Low Sulphur Fuels

•All mogas 30 ppm avg, 80 ppm max Jan 2005

•Ultra low sulphur diesel 15 ppm June 2006

•Unlikely that Western Canadian supply will besignificantly impacted by new regulations

•Major issue around shipping low sulphurproducts in a crude pipeline

Low Sulphur Products in TMPL

•Products have been shipped in TMPL since mid80’s

•Products pick up sulphur in pipeline

•Not an issue when sulphur spec is 200+ ppm

•With low sulphur fuels, product will needtreatment at end of pipe or ?????

•Product shippers currently studying this problem

Isooctane

•Alberta Envirofuels plant in Edmonton 50/50 JVbetween ChevronTexaco and Fortum

•Recently converted from MTBE to isooctane

•Isooctane: 100 octane, low vapour pressure, noaromatics, low olefin

•Isooctane production less than MTBE

•Destined for California market

Summary

•Western Canada likely to remain fairly balanced

•TMPL is crucial to BC supply

•TMPL is proven, reliable, well maintained

•Shipping low sulphur products in TMPL is animportant issue that will be resolved