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Monday, December 26, 2016

Wednesday, December 14, 2016

How We Get Our Petroleum Products

Both Tofino and Ucluelet have organizations that work very hard to get Tourists to visit the area. The vast majority of tourists consume petroleum products to get here. The following explains how these products are delivered :

Petroleum Products Distribution Networks

The logistics network required to supply petroleum products from the refineries to the end-users is a complex system of pipelines, ships, railways and trucks. Often several methods of transportation are utilized to move petroleum products from the refineries, ports and large terminals to tremendously disperse markets all across Canada. The long distances and variety of transportation modes used can pose challenges for the refiners who must maintain strict product specifications. Degradation or contamination of product in transit can result in costly re-processing at the delivery point if the integrity of the distribution system is not carefully monitored. This is increasingly important as environmental regulations result in cleaner and more stringent product characteristics.

Product Exchanges

In order to reduce transportation costs and to capitalize on increasing economies of scale, refiners enter into a large number of product exchange agreements with one another. Product exchanges occur when one refiner provides another refiner with specific products in a certain location in exchange for a similar quality and volume of products in another location.
Product exchanges significantly reduce the volumes and distances over which products are moved, thereby considerably reducing transportation costs and environmental exposure. These agreements have not only allowed the industry to consolidate their operations at the refinery level but have also led to a consolidation of local product terminals. It is no longer unusual to purchase gasoline from a branded outlet that was produced by one of its main competitors.
In cases where product exchanges are not available, companies need to make other arrangements to supply their terminals and retail networks. The method of transportation they select to move their products will be influenced by several factors. Geographic barriers are a major concern as well as the volume of products demanded in each of these markets and the relative costs of transportation. Each mode of transportation has its own inherent strengths and weaknesses.

Refineries to Terminals

Product terminals are more widely distributed than refineries and are generally located near major markets. Pipelines are the safest, most reliable and cost-effective way of transporting the large volume of petroleum products that must be moved throughout Canada each day. However, the enormous capital cost associated with constructing pipelines limits their use to locations where very large volumes of product are to be moved for an extended period of time. The payback period for these projects is often 15-20 years or greater.
Where the volume of petroleum products cannot justify the construction of a pipeline, petroleum products are transported to terminals across land by truck and rail and over water by marine tanker. In Atlantic Canada, all petroleum product terminals are serviced by marine tanker. In other areas of Canada, railways and trucks are much more important. Although transportation by truck is the most expensive transportation method, it is also the most flexible. Highway truck tankers transport all gasoline from the terminals or refinery truck loading facilities (commonly referred to as "racks") to underground storage tanks at each retail outlet.
Most of Canada's refined petroleum product distribution network is operated by three national oil companies (Shell, PetroCanada, and Imperial Oil) and a handful of regional refiners (Irving Oil, Ultramar, Suncor Energy, Federated Co-op, Husky and Chevron). With only a few exceptions, all products terminals are owned and operated by one of these companies.
The Canadian downstream petroleum industry can be broken into three distinct regions: Western Canada, Ontario and Quebec/Atlantic Canada. Although some product movements do occur between regions, such as shipments from Quebec refiners into Ontario, each of these regions has historically been self-sufficient. In 2005 Ontario shifted to a net import position with the closure of the Oakville refinery and increased product movements from Quebec refineries. Product imports can play a significant role in satisfying petroleum product demand in Canada. The availability of both crude oil and petroleum product imports in every region hinges on geographic constraints. Some regions are better suited than others to accommodate imported products. Each area has its own natural features and this creates some unique situations.

Atlantic/Quebec

In the Atlantic/Quebec region, product movements from refineries to terminals occur primarily by ship. An exception is the unit train employed by Ultramar to move product from their refinery near Quebec City to Montréal. Ultramar is currently planning to build a pipeline from the St. Romuald refinery across the river from Quebec City to east-end Montreal to be operated in conjunction with the unit trains.
Terminal locations are governed by proximity to markets and alternative transportation modes. This region provides an excellent example of product exchanges as Imperial Oil and Irving Oil provide refined petroleum products to Shell, PetroCanada and Ultramar at Atlantic terminals in exchange for similar quantities of product in Montreal and Quebec City.
Because of their connection via major waterways, Atlantic Canada and Quebec have good access to imports from the northeastern U.S. and Europe. As a result there are a number of major independent marketers who import petroleum products into Montreal for sale in the Quebec and Ontario markets.

Ontario

Product movements from refineries to terminals within Ontario are primarily done by pipeline, although some movements by marine are made into Sault Ste Marie and Thunder Bay. Thunder Bay is also supplied by rail from Winnipeg, and Sault Ste-Marie is partially supplied by rail and ship from Quebec. Eastern Ontario (Cornwall and Ottawa) obtains a large amount of their supply from Montréal via the Trans Northern Pipeline (TNPL). Three product pipelines, two from Sarnia refineries and the TNPL from Montréal, supply the Toronto area. Toronto is one location where essentially all refiners maintain terminals due to the large demand for products in the area. In 2005 the Toronto to Cornwall section of TNPLwas reversed to allow product to move from Quebec refineries all the way into Toronto.
Ontario also has access to supplies from large U.S. markets and can also bring in cargos via the St. Laurence Seaway from Quebec, Atlantic or offshore refineries. However, logistical constraints, such as the size of ships that can navigate the Seaway and the seaway-shipping season, increase the cost of these supplies. Other modes of transportation, such as pipeline, unit train and trucking, are necessary to bring in products from other regions.

Western Canada

Most of Western Canada is landlocked, and as such, has very limited access to supplies from other regions. Only British columbia has access to imported product as the current infrastructure was not designed to transport supplies to the Prairies from other regions. However, the Edmonton refineries supply petroleum products into the Vancouver market via the TransMountain pipeline (TMPL). In the event of a supply shortage in the Prairies, these Alberta refiners have the ability to balance supply and demand by importing product into Vancouver from Washington State, freeing up additional Edmonton production for consumption in prairie markets.
Product movements from refineries to terminals in the West are primarily done by pipeline. Movement by rail to the territories, B.C. interior and to Thunder Bay in western Ontario also occurs. Barges carry product from Vancouver to terminals on Vancouver Island and along the coast and from terminals in the Northwest Territories to more northern locations along the MacKenzie River.
Edmonton refineries provide about 50-60% of the petroleum product needs in the Vancouver market. The rest of the Vancouver area is supplied either by the Chevron refinery in Vancouver, or with product imports from the U.S. The West has some unique dual product pipelines. Enbridge Line 1 pipeline from Edmonton, Alberta, to Gretna, Manitoba, ships refined products plus natural gas liquids (NGLs) and synthetic crude. TMPL from Edmonton to Vancouver ships refined products plus all types of crude oil. The crude oil leaves deposits of substances, like sulphur, on the pipeline wall as it passes through the pipeline. These can be picked up by the clean products like gasoline that follow the crude oil through the line. Gasoline shipped viaTMPL to Vancouver must undergo further treating prior to sale to remove impurities picked up in transit.

Terminals

As a result of the significant rationalization of terminals over the last 20 years, in some markets, only one terminal exists and all marketers load at that terminal. From these local terminals, petroleum products are trucked to retail / customer sites. Each product has a different delivery system from the terminal depending on the customer base. For example, jet fuel is often moved by pipeline directly to the airport. Diesel fuel is distributed through retail outlets, large commercial card lock facilities where trucking companies can fill up at unattended distribution sites, or by truck delivered directly to customer tankage. Furnace oil is distributed from the terminal directly to home heating customers.
Gasoline, the most visible and widely used of all the products, has the most dispersed distribution network. Before the gasoline leaves the terminal, some gasoline retailers will add performance and detergent additives to distinguish their brand from those of their competitors. The formula for each additive package is unique to that specific brand. As many companies pick up product from the same terminal, the proprietary additives are generally added at the terminal and are the only way to differentiate gasoline at retail outlets.
Ethanol, and ethanol-blended gasoline, because of its ability to pick up water, cannot be transported by pipeline. Ethanol can be shipped by railcar or truck but must be blended at the terminal for those locations supplied by marine or pipeline. Dedicated tanks are required to store the ethanol and the gasoline-blending component with which it will be mixed. The handling of ethanol-blended fuels also requires modifications to other aspects of the fuel distribution system, including trucks, retail storage tanks and service station pumps.

Retail Outlets

The marketing and retailing of gasoline is carried out by many firms, which can generally be divided into two types. The first type consists of outlets operated by the integrated refiner marketers who produce the gasoline, distribute it and market it, often through affiliate or licensed operators who own individual outlets. These companies provide gasoline to their own network and to other retailers under contract. The second type consists of the independent marketers. Independent marketers are those who do not own a refinery but either buy their product from Canadian refiners or import the gasoline. They tend to operate small numbers of outlets in specific locales, but some large networks exist. Some of the larger networks of independent stations include Wilson Fuels, Couche-Tard, OLCO, Canadian Tire, Cango, and Domo. Generally, the large independents have a 15-25% share of the sales volume in urban markets.
The three major refiners - Imperial Oil, Shell and PetroCanada - account for about 36% of the branded stations in Canada and have the largest share of stations in each of the regions except the Atlantic. Imperial Oil is the largest retailer in Canada with 1,978 Esso stations followed by Shell's 1,762 and PetroCanada's 1,375 sites. It is important to note that a large percentage of these "branded" stations are independently owned and operated under supply contracts with the company whose brand of gasoline is sold at that outlet.
According to a report published by MJ Ervin and Associates (December 2004), of the 14,034 service stations in Canada, only 16% of all gasoline stations come under the price control of one of the three majors and only 32% of service stations come under the price control of one of the 10 refiner-marketers. Independent proprietors operate the remaining 68% of Canadian service stations and set their own prices.
There is also an important distinction between the number of outlets a company owns and their market share. Not all stations have the same volume throughput. The majors tend to have higher volume throughput per outlet so generally are able to capture a larger share of the market with fewer stations. In 2004, Shell service stations averaged sales of 4.1 million litres, while Esso and Petro-Canada's company-owned sites had average sales of more than 5.6 million litres per site. Since 2000, the three major oil companies have increased their sales by 4.5% despite reducing the number of outlets they own by 18%.
While the major and regional refiner-marketers have been closing some of their low performance outlets, independent retailers have been increasing their presence in the gasoline market. The most notable new participants are supermarkets. Grocery chains such as Superstore and Safeway have entered the retail gasoline market. The supermarkets are known for their high-volume, low-margin retailing and are considered by many as an efficient and aggressive new source of competition in the competition in the industry.
Date Modified: 
2016-07-20

Saturday, December 3, 2016

Road Closure

http://www.drivebc.com/mobile/pub/events/id/227284.html


I came through last night by detouring on Toquart Bay road.Not in the greatest condition and not marked.Not sure if this detour is still available.