Questions raised over U.S. company’s bid for B.C. fuel refinery

The potential acquisition of a Burnaby, B.C., fuel refinery by a Texas energy company has sparked concerns among workers and energy experts, particularly in light of Canada’s ongoing trade dispute with the United States. Sunoco, based in Dallas, has put forth a $9.1 billion US bid for Calgary’s Parkland Corporation.

Parkland currently owns the Burnaby refinery, as well as gas stations and a fuel distribution division. Unifor, the union representing approximately 150 employees at the Burnaby facility, has raised alarm over the proposed deal, likening it to handing over control of “critical energy infrastructure to a foreign multinational” during a trade war.

Russ Day, president of Unifor Local 601, emphasized the importance of preserving the refinery’s operations, as it produces a significant portion of the region’s gasoline and jet fuel. He expressed concerns about potential job losses and the impact on the supply of finished fuels to the market if the refinery were to be acquired by an external entity.

In response to these apprehensions, Parkland’s executive chairman Michael Jennings assured that Sunoco has committed to safeguarding Canadian jobs and maintaining the company’s Calgary headquarters. However, questions have been raised within the energy sector regarding the impact of tariffs on Parkland’s valuation and the timing of such a deal amidst trade uncertainties between Canada and the U.S.

Jotham Peters from Navius Research highlighted the potential devaluation of Canadian companies due to tariffs, which could make them more susceptible to acquisition. Philip Solimine, a post-doc fellow at the University of British Columbia, expressed surprise at the proposed acquisition given the current trade climate and suggested that it could be leveraged as a bargaining chip in negotiations.

While B.C. Energy and Climate Solutions Minister Adrian Dix acknowledged the merger talks and emphasized the importance of keeping the refinery operational, the deal is still subject to a federal review under the Investment Canada Act. This legislation evaluates large-scale acquisitions of Canadian companies by foreign buyers to ensure they are in the national interest.

Shareholders of Parkland are scheduled to vote on the acquisition on June 24th. The federal government has yet to provide comment on the matter. As discussions continue between Parkland, Sunoco, and Unifor, stakeholders remain vigilant about the implications of this potential acquisition on Canada’s energy sector and workforce.