Wednesday, November 18, 2015

David Black looks to oil by rail concept for his planned Kitimat Clean refinery project

It's been a while since David Black has provided an update on his planned Oil refining facility for Kitimat, with notes on the Kitimat Clean project few and far between for much of the last year.

The most recent item related to the development was posted to the Kitimat Clean website almost a year ago, with a press release from December of 2014.

However, with a couple of issues returning to the forefront in recent weeks, the would be Kitimat industrialist has made his way back to the news cycle, with a few thoughts on his proposed plans for the Northwest community.

David Black is considering the use
of oil trains to deliver Alberta bitumen
to his proposed Kitimat refinery
With the Northern Gateway pipeline project seemingly facing any number of hurdles now, the proponent of the Kitimat Clean oil refinery and shipment terminal is seemingly making plans to turn his back on the need for a pipeline to feed his terminal and instead, is casting a look over towards the rail line that connects Kitimat with the Alberta oil sands.

Mr. Black has outlined for the Calgary Herald his shift in focus for his estimated 22 billion dollar refinery, suggesting to the Calgary paper that he won't need a pipeline to deliver the required 550,000 barrel per day supply.

Instead project planners have it seems reconfigured the design plans for the project, to make use of the Canadian National Railway line into and out of Kitimat.

The CN line into Kitimat could
see a significant increase in use
should David Black follow through
on a plan to use oil by rail for
his Kitimat Clean project
The Terminal proponent also notes that by using oil by rail, Kitimat Clean could eliminate the need for the use of diluent, which could allow for more bitumen to be shipped to the facility than through a pipeline.

He anticipates that the project will take two years to go through any regulatory process, with six years of construction required before the first shipments out of Kitimat would take place.

An overview of his new approach to the Kitimat Clean concept can be reviewed from the Herald piece here.

Mr. Black also touches on the recent news of a federal moratorium on oil tankers on the North Coast, suggesting that he doesn't believe that the Federal decision will affect plans such as his to ship refined product from the region.

As we noted on the blog last week, the proposed moratorium on tankers for the North Coast was part of the mandate letter provided by Prime Minister Justin Trudeau, to the new Fisheries Minister Hunter Tootoo.

Work with the Ministers of Transport, Natural Resources and Environment and Climate Change to formalize the moratorium on crude oil tanker traffic on British Columbia’s North Coast, including the Dixon Entrance, Hecate Strait, and Queen Charlotte Sound.

The exact nature of the federal moratorium proposal does seem at the moment not to have been fully explained to Canadians, leaving us a little unclear as to what it will ban, or accept, as far as shipment of oil from the North Coast.

The early reaction from many across the province would seem to suggest that most believe, that the moves by the new Trudeau Government mean no tankers at all will be transiting through the North Coast.

Clearly, the Federal government is going to have provide a bit more detail and outline exactly what the proposed moratorium will involve and how it will affect the various proposals that are being considered when it comes to oil exports from the region.

We imagine that Mr. Black will be one of the first to want to hear from the Federal government on that one, before he starts to spend some of that 22 billion dollars.

For more background on the Kitimat Clean proposal see our archive page here.

More items related to the range of Oil Terminal proposals for the North Coast can be found here.

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