How Much Oil Does Canada Import? Too Much!

How Much Oil Does Canada Import? Too Much!

Just how much oil does Canada import every year? The answer is shocking actually, considering that Canada has the third largest proven oil reserves in the world.

Looking at the Canadian International Merchandise Trade Database, it shows Canada imported approximately $19.4 billion of crude oil in 2018, with that number dropping slightly to $16.6 billion in 2017. A more detailed look in this chart below:

How Much Oil Canada Has Imported - Chart: 2014-2018

chart showing how much oil Canada has imported between 2014-2018

Adding the value of crude oil Canada has imported over the past decade from the source above shows our major suppliers:

> United States ($70 billion+)

> Saudi Arabia ($23 billion+)

> Norway ($16 billion+)

> Nigeria ($11 billion+)

> Angola ($9 billion+)

…plus billions more from other African, Middle Eastern and European countries.

These figures above do not even include light oils and other products / chemicals derived from petroleum. In 2018, Canada imported $14.4 billion worth of this type of classification, while in 2017 that figure dropped slightly to $10.8 billion.

Together, Canada imported $30 billion+ per year in 2017 and 2018 for all petroleum import classifications combined.

Canada and Saudi Arabia - Democracy Index 2018 comparison

How Much Oil Does Canada's Provinces Import?

So, how much oil does Canada import into different parts of the country? If you’ve guessed most comes into the Atlantic provinces, Ontario and Quebec, you’re right.

The lack of pipeline infrastructure from the west - where the world’s third largest oil reserves are found, in the Alberta oil sands – to the east is apparent in this map from Natural Resources Canada:

This is a major reason why the eastern and Atlantic provinces rely on massive quantities of foreign oil imports for supply, despite the reversal / expansion of Enbridge’s Line 9 pipeline over the years which has allowed Ontario and Quebec refineries to source more oil from North America.

Major importation routes include the St. Lawrence River which sees more than 500,000 barrels of petroleum products sail to refineries in Quebec each day.

New Brunswick's Irving Refinery also relies almost entirely on foreign oil imports, although it does sometimes process offshore blends from the east coast. Irving is Canada’s largest refinery with a feedstock capacity of more than 320,000 barrels a day.

How Much Foreign Oil Canadian Provinces Import - Chart: 2014-2018

chart showing how much oil Canada's provinces imported between 2014-2018

It's important to note that not all oil imports into Canada are the same; their nature differ when it comes to the west and east of Canada.

For example, looking at the chart above, you may be astonished that Alberta and Saskatchewan, which together account for over 90% of Canada’s crude oil production, imported hundreds of millions worth of oil every year from 2014 to 2018. Alberta’s oil imports specifically are largely attributed to condensate or diluent from the United States which is mixed with bitumen to facilitate transportation by a pipeline.

On the other hand, oil imports into the eastern and Atlantic provinces come mainly from the United States and Saudi Arabia in recent years. Note the provinces with a simple dash in the chart above, which got oil entirely from domestic sources kind of like how Prince Edward Island gets most of its gas from refinery output at Irving.

Canadian Oil Could Replace Foreign Oil in the East

So, the question remains: how much of the oil imported by the eastern and Atlantic provinces could be replaced by Canadian oil if a pipeline were built like the now defunct Energy East project?

The answer isn’t as simple as just “build the pipeline and replace all foreign oil” unfortunately, although doing so would help some eastern refineries turn a higher profit (as shown by the CERI study below), while also allowing Canada to export its ethically produced oil to Europe and Asia and meet some of the growing global demand.

The Canadian Energy Research Institute (CERI) examined this topic in Study #167 – An Economic and Environmental Assessment of Eastern Canadian Crude Oil Imports released in January of 2018. Their findings are based on four scenarios:

Made in Canada – where all foreign oil imported into Canada is replaced with domestic oil regardless of the cost. This scenario considers the effect of expanded pipeline infrastructure in Eastern Canada.

Expanded Access – where less expensive Canadian crude is substituted in for imported foreign oil, with a new pipeline connecting the eastern and western parts of the country for new domestic supply.

Current Reality – where existing pipeline infrastructure is used but Canadian crude replaces foreign oil in central and eastern Canadian refineries, but not the full amount relative to commodity prices and the associated economic feasibility of doing so.

International Social Concerns – where Canadian crude is substituted for imported oil from nations that have serious social concerns i.e. poor living standards, low food security, tarnished human rights, non-existent environmental protection, etc.

This study considers costs and how greenhouse gas emissions would be affected if Canadian crude were to replace foreign oil under these given scenarios.

Note: CERI’s study is quite complex. For further understanding of the scenarios mentioned above, it’s recommended you read the report.

CERI – Chart: Four Scenarios, Replacing Foreign Oil with Canadian Oil

CERI - Study #167 - Table E.1 - Key Conclusions

Three of the four given scenarios harbour positive economic results ranging from savings of $23 million to $317 million, and a reduction of CO2 equivalent between 2 to 2.2 million tonnes per annum. Two of the three positive scenarios call for a new pipeline, while the third (without new infrastructure) takes into account Canadian crude supplies that are cheaper than their imported counterparts only.

After studying CERI’s report, the questions we should all be asking are:

> How much oil does Canada import from domestic sources?

> What economic benefits does more domestic oil being used in the eastern parts of the country bring?

It’s important to point out that the added employment opportunities and economic contribution of doing so is not evaluated in CERI’s report.

Two more questions we should ask ourselves as Canadians isn't only “how much oil does Canada import,” but rather:

> How much oil does Canada export?

> What are the socio-economic benefits of expanded export capacity to international markets other than the U.S.?"

How Much Oil Does Canada Import? Way Too Much!

Polls show that across the country a majority of Canadians are more supportive of using energy from domestic sources than from foreign sources. Even in Quebec where it’s been said in recent years that there is “no social license” for a new oil pipeline, two out of three Quebecers support using oil and gas from Western Canada versus having it imported from countries like Saudi Arabia and elsewhere.

Another poll by Nanos Research shows about 80 per cent of Canadians support a long-term role for the oil and gas industry as long as it operates in an environmentally friendly and responsible way. Furthermore, two-thirds agree that Canadian oil and gas can be useful in displacing higher emission sources such as coal in developing parts of the world like Asia.

It seems Canadians from coast-to-coast are starting to realize our oil and gas industry is world-class when it comes to clean technology, GHG emission reductions and innovation, while also being a vital part of the economy.

Like the majority of Canadians, we believe Canada should be using as much oil from domestic sources as possible and a supplier of choice as oil demand continues to grow over the decades to come.

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