B.C. sees two competing oil refinery proposals near Kitimat

British Columbia now has two competing proposals for oil refineries near Kitimat, both betting that pipeline projects have become so unpalatable that plans to ship Alberta bitumen by rail are more likely to be approved.

The bitumen refinery projects add to the 20 B.C. proposals to export liquefied natural gas. Experts say only a handful of LNG ventures have a realistic chance amid fierce global competition.

“There is going to be a shakeout of viable projects,” said Mary Hemmingsen, a partner at consulting firm KPMG Canada.

Samer Salameh, executive chairman of the latest B.C. oil refinery project to embrace rail, Pacific Future Energy, said his top priorities will be committing to rigorous environmental standards and recognizing aboriginal rights. He said for energy plans to be successful in British Columbia, they must develop technology to keep carbon dioxide emissions to a minimum and hold respectful talks with First Nations.

Pacific Future Energy filed a 120-page project description with the B.C. Environmental Assessment Office and the Canadian Environmental Assessment Agency this week.

“We are finally making this vision a reality, and this is the first step,” Mr. Salameh said in an interview, vowing that the proposed bitumen refinery will eliminate a byproduct called petroleum coke, which is a major source of greenhouse gas emissions.

Newspaper publisher David Black said he remains keen to press ahead with his rival project Kitimat Clean Ltd., which also aims to convert bitumen from the oil sands into refined products for shipping in tankers to Asian energy buyers. He estimates that his larger refinery would cost $22-billion (U.S.) to construct.