Vancouver crude exports up fourfold in June

Crude oil exports on Canada's Pacific coast quadrupled in June, the first full calendar month with ship loadings on the expanded Trans Mountain pipeline system, according to data from Vortexa.

About 300,000 b/d of crude was exported from the port of Vancouver last month, up from 75,000 b/d in May and up nearly ninefold from 35,000 b/d in June 2023, according to Vortexa. The 590,000 b/d Trans Mountain Expansion (TMX) project began commercial service on 1 May, nearly tripling the capacity of the pipeline system to 890,000 b/d, though the first TMX cargo loaded on 20 May.

Up to 250,000 b/d of crude from Trans Mountain can also go to Washington state on the Puget Sound pipeline system.

Of the 19 Aframaxes that had discharged TMX crude by 1 July, nine discharged onto very large crude carriers (VLCCs) at the Pacific Area Lightering (PAL) zone, six discharged at ports on the US west coast and three went directly to China, according to Kpler data. Three remained in transit for either Los Angeles or PAL as of 2 July.

Another Aframax, operated by Unipec, partially discharged at Long Beach, next to Los Angeles, before topping off a VLCC at PAL.

Prior to TMX, two to four Aframaxes per month discharged Canadian crude at ports on the US west coast.

According to Kpler, four VLCCs departed PAL with Canadian crude for destinations in Asia-Pacific: the Eagle Verona, which co-loaded one 550,000 bl cargo of Access Western Blend (AWB) with 1.5mn bl of Colombian Castilla destined for China; the Advantage Value, which has three 550,000 bl cargoes of AWB destined for India; the Cosrich Lake, which has four cargoes of TMX crude totaling 1.75mn bl destined for China; and the New Pearl, which co-loaded two 550,000 bl cargoes of AWB with Ecuadorian crude destined for China.

Of the 22 Aframax voyages from Vancouver in June, half went on time-chartered vessels and the other half went on spot market tonnage, including rehired time-chartered vessels. Freight rates to ship Cold Lake from Vancouver last month averaged $2.25/bl for voyages to the US west coast and $6.33/bl for voyages directly to China, according to Argus data.

Over the same span, the cost to reverse lighter, or transfer, three 550,000 bl shipments of Cold Lake from Vancouver onto a VLCC at PAL then onward to China averaged about $7.075mn lumpsum, or $4.32/bl, excluding demurrage costs, according to Argus estimates. The heavy nature of Canadian crude and Aframax draft restrictions in Vancouver may complicate fully loading a 2mn bl VLCC.

Twenty-nine Aframaxes are expected to be available to load in Vancouver throughout July, of which 17 are time-chartered and 12 are spot market vessels. Time-chartered ships can still be relet for use by other shippers.

By Tray Swanson