Tradewinds, Jacques and Los on “the Canadian Shipping Pipeline” to the U.S Gulf

 

genmar daphne

Genmar Daphne Steaming up the Houston Ship Channel with assistance from tugboats. The 106,000 tons DWT crude oil tanker owned by General Maritime. Credit: Roy Luck

Cost Estimates:

 

Commodity $/bbl:

ECC/Europe aframax  Montreal/Gdańsk, Poland Round-Voyage estimate $3/bbl².

ECC/US: under $2.73, marine transportation has the potential to cannibalize crude-by-rail shipped volume to the USWC.
Shipping $/Day:

TCE estimates calculated by CR Weber for the Genmar Daphne were ~$18,517/day ECC/USG. and ~$12,759/day for Caribs/USG (rates are very depressed , we hit the $45,000/day mark last summer)

I’m not sure about the reason for a 45% premium into the Aframax units calling ECC.
Maybe it’s because the Oil company leasing the aframax unit can take a voy from USG to the ECC for another company before loading the Canadian crude cargo bound to the USG ?
Basis Aframax 66,000MT (RV)
ECC/USG Caribs/USG
$/bbl 2.73²
$/day 18,517* 12,759*
 Calculations made by Simon Jacques Commodity Merchant Trading², George Los CR Weber*.
Tradewinds Norway Canadian Cash for GENMAR
 _________________________________________________________________________________________________________

Enbridge is scheduled to begin filling Line 9B with crude by Oct. 15th and gradually they will ramp-up to 300,000 per day.Then we will have the Pipeline called TCP’s Energy East, this one is a monster with 1.1 million per day in 2017.To give you an idea it us more than entire oil production in the UK or the entire North-Sea!

The volume traded in the ECC(East-Coast-Canada) is still very limited compared to USG/Caribs or Baltic/UKC

Suncor is currently displacing 4-5 aframax units/month from other regions.

Institute Warranty Limits: For St Lawrence River and its tributaries, seasonal restrictions are from December 1 to April 15th.
In the Baltic: 10 December to 25 May. This winter element will also need to be built into the aframax curve.
Inland Crude Transportation
I heard that the first cargo to Italy was finally a Lloyd blend conventional crude produced by Husky Energy (quite similar to the WCS)  and there are dozens producers seeking crude marketing alternatives in Canada.
When the Endbridge pipeline will ramp-up, the land cost will drop by 2/3, if they Albertan Oil company can lock the freight leg, they will be able to improve their bbl net back.
Albertan shippers want to export the WCS crude to the U.S Gulf Coast, Europe, India…
Some will say that the commitment of Canadian Oil producers to the St-Lawrence River and ECC is a direct consequence of President Barack Obama’s unwillingness to give the presidential seal for the Keystone XL Pipeline.
The Irony is that what they cannot build on land is just good news for shipping, “the Canadian to U.S Gulf shipping pipeline”.

 

About TradeWinds

TradeWinds offers a comprehensive package keeping subscribers up-to-date with what is happening in the global shipping world news as it happens in the different time-zones throughout the day.

About CR Weber

George P. Los is Senior Market Analyst at Charles R. Weber.

Based in Greenwich, Connecticut, Charles R. Weber Company, Inc. is one of the oldest and largest tanker brokerage firms in the United States.

About Simon Jacques

He is the author of the Trade Shipping and Finance Wizard. For Commodity Merchants he provides the utmost quality services that encompass each facet of the Commodities and Freight business. The goal is to avoid tail-risk, understand what is the tail-risk of others and generate trade patents from this understanding. Contact for Commodity Merchant Trading (CMT) and Shipping Advisory Services

commoditymerchanttradingandshippingadvisory

 

Source: Tradewinds, Canadian Cash for Genmar,  10/02/2014

Canada could beat Russia in its own backyard, a Synthetic Ural “made in Canada” for Europe

The Trade Shipping and Finance Wizard © 2014

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