EDMONTON - Economists for pipeline builder Enbridge say it makes more financial sense to ship crude oil to Asia than trying to refine it first in Canada.
Economist Robert Mansell told a federal review panel in Edmonton that the heavy startup costs and the thin profit margins don't make refineries feasible without heavy government subsidy.
Mansell says given the construction boom on refineries in Asia, it just makes more sense to ship the crude oil there.
Enbridge (TSX:ENB) is seeking federal approval to build a pipeline from the Edmonton area across B.C. to a port at Kitimat where crude would be shipped by supertanker to Asia.
Mansell was answering questions from a lawyer representing the Alberta Federation of Labour.
Outside the hearing, AFL President Gil McGowan said he doesn't accept the argument from Enbridge, given that existing Canadian refineries are profitable and that Asia is building them as fast as it can.