I discussed this more with "my expert", who does work in oil and other energy fuels. I am told the problem is as Sarlock described. The margin on oil refinement is not what it is for production, so companies are reticent to take on huge capital projects like building a refinery when they can spend the money on increased production and get a better margin and quicker ROI.

Keep in mind that it takes not only a lot of money but also a lot of time to build a refinery. Shell just scrubbed their huge Sarnia project. A quote from the story on CTV.ca:

In addition to the ballooning capital costs, oil companies have also had to contend with the spectre of reduced consumer demand that could result from soaring fuel prices.

Shell's existing 72,000-barrel-a-day facility in Sarnia, a border city that hosts an array of refineries and petrochemical plants, will continue to process oil from a variety of different sources, including some from Alberta.

Please post a reference to the "$100 Billion in additional refineries in the central alberta area." I would like to pass that information along. I do realize, from the same story, that Shell is spending $27B on an upgrade facility in Alberta. But they also say they are looking at options on the West Coast and the States, presumably existign refineries.

Refinery capacity has not increased in North America in years. Where it has done is in developing nations and the third world, where it is cheaper to build and refinement does not have to be to the same level as here (meaning the outputs at these refineries are more along the lines of what North American refineries would consider components with which they would blend for better fuels).

If the margin for refining has changed, then the refineries will come, no doubt. But money will always go into the place where ROI is quicker.

I agree that Canada should refine here. We should also develop forestry products here, but have not for decades of forest harvesting. But Canada has always and continues to send its raw materials to others to refine and make a lot of money.

Cheers,

Bluenoser