David Black is planning to develop a refinery in the Kitimat Valley.

Kitimat Clean Ltd. pursuing oil refinery

David Black may be best known as the owner of Black Press, but he has turned his attention to energy as the president of Kitimat Clean Ltd.

David Black may be best known as the owner of Black Press, which operates community newspapers throughout the province, but the media mogul has turned his attention to energy as the president of Kitimat Clean Ltd.

The company, formed in the summer of 2012, is proposing construction of an oil refinery in the Kitimat valley between Kitimat and Terrace. It would be the single largest investment in the history of the province. Between the refinery and eight pipelines to carry various petroleum products to a marine export terminal in Kitimat, the total capital costs associated with the project ring in at approximately $25 billion. The refinery would produce 240,000 barrels per day of diesel, 100,000 barrels per day of gasoline and 50,000 barrels per day of kerosene or aviation fuel, refined from heavy oil.

The direct economic impact of the refinery to the region, however, would also be larger than any other project being considered.

“We are talking about 1,500 direct jobs at the refinery and 1,500 jobs for contractors servicing the facility. During construction, we would require 6,000 workers for a five-year period… typically there is a one-to-one job ratio with this type of job creation, so that would add another 3,000 indirect jobs,” said Black.

Aside from removing the prospect of bitumen being shipped in the water, Black wants to create a Canadian refinery to ensure the stricter environmental standards in place in the country are adhered to. Black is planning to make the refinery the cleanest in the world, including spending an additional $3 billion to use a technology developed by Expander Energy of Calgary that reduces the greenhouse gases emissions associated with processing heavy oil by 50 per cent per barrel.

“This will broaden the province’s economy, create thousands of high paying union and non-union jobs, create work for B.C. contractors and pay a high amount of taxes to the province. Best of all it will improve the world’s environment and that is a key reason why this old newspaper man and his family is so keen on the idea,” he said.

Black hopes to have the Kitimat Clean refinery operational by 2020, and said finding customers shouldn’t be a problem.

“I have had a lot of discussions with the Far East and there is a lot of interest from a number of countries. There are a variety of reasons they are interested, but the main one is that we can land jet fuel and diesel in their country cheaper than they can make it,” he said.

“We have the financing committed to do this whole project,” added Richard Cook of the Oppenheimer Investment Group.

The refinery, which would be the first constructed in the province, has found a high level of support among residents. A telephone survey of 800 British Columbians conducted last spring found more than 52 per cent support the Kitimat Clean proposal, a number that increases to 66 per cent of those polled if an environmentally-sound method of transporting bitumen from Alberta to the refinery in B.C. was found.