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Syncrude cuts shipments over tight pipeline space


MARK RALSTON/Mark Ralston/AFP/Getty Images

Syncrude Canada Ltd., one of the biggest oil sands producers, is delaying crude shipments to cope with the tight pipeline space that is plaguing the country's oil market, the joint venture's largest owner said Wednesday.

Syncrude has not reduced output at the 350,000 barrel a day northern Alberta project, but has been forced to store some crude on site, said Alison Trollope, spokeswoman for Canadian Oil Sands Trust, which has a 37 per cent stake.

"The production hasn't been affected, but the shipments have," Ms. Trollope said. "What that means is that some barrels that are produced in December may be shipped in January. But we don't expect a material impact at this time."

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On Tuesday, Enbridge Inc. said some of its feeder pipelines had temporary disruptions after the company raised apportionment levels on its main system, which carries the bulk of Canadian oil exports to the United States.

The company apportions, or rations, space on its lines when nominations by its shippers exceed the overall capacity.

Enbridge rationed additional space last week after an unplanned cut in flow rates on its 670,000 barrels-per-day Line 6A in the U.S. Midwest.

Other producers have reduced output to deal with the situation, which has weakened prices for Canadian crude .

Ms. Trollope said Syncrude currently has enough storage space to deal with the situation.

Adding to tight transport in the region, space on Kinder Morgan's 300,000 bpd Trans Mountain pipeline to the West Coast from Alberta was oversubscribed by 24 per cent for December.

Canadian Oil Sands' partners in Syncrude are Imperial Oil Ltd., Suncor Energy Inc., Sinopec Corp., Nexen Inc., JX Holdings Inc. unit Mocal Energy and Murphy Oil Co.

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