Court rules against Suncor in request for extension
The ongoing court case between Suncor Energy and Prince Rupert based Ridley Terminals took another turn on February 2, with the court ruling against a request from Suncor.
Documents filed by Suncor on February 1 requested that the current court order prohibiting Ridley Terminals from refusing shipments from Suncor until February 8, 2011 be extended “until the disposition of this matter by arbitration or until such time as this Honourable Court deems just”.
The next day the court denied the request and that denial means Ridley Terminals could legally start refusing shipments from Suncor that don’t have an anti-freeze agent beginning on Tuesday. However, Suncor says getting an anti-freeze agent in place is a work in progress.
“Suncor has made all reasonable efforts to identify and apply a suitable freeze-prevention agent to its petroleum coke and believes it is close to being able to apply such an agent to its product before it is shipped to RTI. Suncor still has to obtain RTI’s acceptance of any agent Suncor intends to apply to its petroleum coke,” reads the document.
Suncor says it takes seven days for shipments to get from its Alberta operations to Ridley Terminals, and the lack of certainty about whether or not RTI would accept orders shipped after February 1 without an anti-freezing agent creates a great deal of uncertainty and has a great impact on Suncor and its customers.
“Suncor requires certainty for an extended period of time otherwise it will face irreparable harm. For example, if RTI refuses to accept deliveries of petroleum coke after the order expires on February 8, Suncor will not have enough petroleum coke stoed at RTI to fill a ship and this will lead to the type of irreparable harm upon which the Court granted the initial order,” reads the document.
“Further, the agreement obligates Suncor to ship all of its petroleum coke for export to RTI. If Suncor is to comply with its contractual obligations, Suncor continues to be unable to deliver its petroleum coke to another location (assuming for the moment that the numerous logistical issues surrounding an alternate port can be overcome) and thus mitigate any losses or damage that it will suffer. This will create a domino effect and may curtail operations at the Oil Sands if Suncor cannot ship its petroleum coke."