SPECIAL REPORT: Diesel crunch worsens; supply weeks from normal

EDMONTON — Smack dab in the middle of the prairies the price of diesel fuel for once isn’t cheaper than anywhere else in Canada. Most likely western truckers would gladly pay no matter the cost — if they could actually find it.

A critical shortage of diesel fuel in western Canada has left many truckers running on fumes. And a full recovery is still weeks away, we’re told.

A combination of planned and unplanned maintenance shutdowns at a trio of refineries in Alberta drastically cut the supply of diesel at the beginning of October.

Several service stations and cardlocks across the prairies went dry and the outlets that did have diesel at the pumps began rationing the fuel.

"There are things I never thought I’d have to encounter and then you get blindsided by them," says Wayne Pedersen, co-owner of Pedersen Transport, a 40-truck fleet that primarily runs routes between Lethbridge, Alta. and Edmonton.

In an interview with todaystrucking.com, Pedersen admits he did not feel the impact immediately. But as fuel supplies continued to get squeezed, his fleet was rationed down to 200 liters per truck, each day.

Carriers in Alberta and the rest of the prairies
still report fuel rationing and cardlock closures.

And he’s not the only one. The dire situation has left a lot of carriers scrambling. "There was no warning and no phone call. One minute it was there and then it wasn’t," Gene Orlick, president of Orlicks Inc. told us. "We’re limited to 500 liters per swipe, per day, which makes it hard to go north."

Orlick runs a fleet of a less than 50 trucks that don’t venture much beyond Alberta’s borders, but it still takes a lot of fuel to trek up and down the province.

"It’s been affecting our deliveries," he adds. "I had a guy who was supposed to be in Calgary for 6 a.m., but he couldn’t get fuel in Edmonton until 6 a.m. It’s something we try and manage day-by-day, and I have to call all the stations for updates everyday."

Orlick fuels his fleet, for the most part, through a cardlock chain in Alberta. A fuel truck does stop by Orlick’s yard to fuel up the trucks, but the operator told Orlick he likely only has a few days left before he has to shut it down too.

Since the majority of truckstops and cardlocks aren’t taking on new clients right now, Orlick has resorted to providing his drivers with VISA gift cards so they can buy diesel wherever they happen to find it.

There have been several reports of carriers having to prioritize their customer list — forced to decide who gets freight delivered and who has to wait. Luckily, the large amount of media attention dedicated to the issue has insulated some carriers from reactionary customers. Besides, it’s not as if many other carriers have enough fuel to swoop in and try to provide better service.

"I’ve had no personal negative impact from the delays, but people still want their stuff delivered," notes Orlick.


Ted Stoner, vice-president of the Canadian Petroleum Producers Institute (CPPI), western division, says there are run-outs and gaps in supply, but "there is diesel out there."

Running on Empty: diesel supply should be fixed in a
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"It’s a shortage, not an outage," he says. "It will be weeks before (inventories are back to normal), not months or years like I’ve heard."

Interestingly, while diesel production wasn’t the only fuel affected by the refinery problems, it’s certainly been the most impacted.

Diesel, jet fuel, home heating fuel and gasoline production were all affected. But according to Stoner, "we’re out of the large gasoline consumption season, jets are able to change supply points easier away from the prairies, and natural gas is used more in the prairies to heat homes."

Diesel users, therefore, got the bottom end of the tank.


Alberta surely is the hardest hit by the refinery troubles, but there were significant diesel shortages in Saskatchewan and Manitoba as well.

In the latter province, things are improving much quicker, though. A chain of cardlock outlets went dry, except for one station. But by the end of last week, the situation  had gotten back to normal, notes Bob Dolyniuk, general manager of the Manitoba Trucking Association.

"There are no companies here that I’m aware of that have had to make significant changes," he tells us. "Some haven’t been able to send trucks to Alberta because of the difficulty getting fuel there, but in Manitoba it’s not a critical situation yet."

A little bit the to the west and things are bleaker.

"It’s not good and it’s not getting any better. There are a number of cardlocks that are dry and others that aren’t operating on a 24-hour basis," says Al Rosseker, executive director of the Saskatchewan Trucking Association. "The small operators are not doing well and it’s at the point we’re calling on the government to start increasing availability. We either need to be getting more trucks to the U.S. for fuel, or railing it in."

The Canadian Trucking Alliance raised an important question last week: How could this happen?

"Given the current economic fragility, this is something Canada can ill-afford," said David Bradley, president and CEO of the CTA. "The trucking industry is being put in the unenviable and untenable position of deciding which of its customers will be guaranteed service and which will not."

It isn’t the first time the CTA has raised concerns with Canada’s fuel supply infrastructure.

In February 2007, the Ontario trucking industry suffered a shortage of diesel following a fire at a refinery in Nanticoke, Ont. and a subsequent strike by CN Rail. Western Canada even had a mini-shortage earlier this year.

As the largest consumer of diesel in the country, the CTA insists it’s time to discuss refinery capacity with the federal government and the CPPI.

"Having a stable, sufficient and predictable supply of truck-grade diesel fuel is not only essential for the trucking industry," said Bradley, "it is vital to the well-being of Canada."


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