Gas prices are displayed as a motorist prepares to pump gas at a station in North Vancouver, B.C., Tuesday, May 10, 2011. Shares in Parkland Fuel Corp. rose by as much as 5.5 per cent after Canada’s largest independent fuel marketer reported strong fourth-quarter results driven by higher refining profit margins. The Calgary-based company that sells fuel through brands including FasGas, Esso and Chevron is reporting net earnings of $77 million in the last three months of 2018, up from $49 million in the year-earlier period. THE CANADIAN PRESS/Jonathan Hayward

Gas price inquiry questions Trans Mountain capacity, company denies collusion

The first of up to four days of oral hearings in the inquiry continue in Vancouver

One of the largest fuel companies in British Columbia says there’s no retail market more competitive than gasoline in Canada and denies any price setting between competitors.

Ian White, senior vice president of marketing and innovation for Parkland Fuel Corp., told a three-member panel leading a public inquiry into the province’s gas prices today that a price difference of a tenth of a cent per litre can be enough to lose customers.

Parkland Fuel operates gas stations under Chevron and other banners, supplies fuel to airlines and BC Ferries, and owns and operates one of B.C.’s only refineries in Burnaby.

White says while factors like clean washrooms and convenience stores can influence consumers, they simply won’t visit your gas station if you don’t have a competitive price.

Economist Henry Kahwaty, who was hired by Parkland, says that environment leads retailers into a race to the bottom until they reach unprofitable prices, at which point there is typically a price jump and the process repeats itself.

But he says controlling that process would require a significant level of co-ordination considering almost half of the gas stations in B.C. are run by independent dealers rather than companies.

“This is not evidence of collusion,” Kahwaty said.

ALSO READ: Companies to appear before panel today in public inquiry into B.C. gas prices

The first of up to four days of oral hearings in the inquiry continue in Vancouver.

Premier John Horgan called the public inquiry in May as prices at the pump reached a record-breaking $1.70 per litre.

At the time, the B.C. Liberals and Alberta government bought advertising blaming Horgan and linking his government’s resistance to the Trans Mountain pipeline expansion and taxes to the surging costs.

Jean-Denis Charlebois, chief economist for the National Energy Board, told the inquiry panel he can’t account for an independent report that contradicts its claim that the Trans Mountain pipeline is operating at capacity.

Charlebois told the three-member panel that in the first quarter of 2019, the Trans Mountain pipeline was operating at 98 per cent capacity.

The panel asked if he could shed light on a report by economists Robyn Allan and Marc Eliesen, the former president of the Insurance Corp. of B.C. and chief executive of BC Hydro, respectively.

Allan and Eliesen say their analysis found the Trans Mountain capacity is 400,000 barrels a day, falling to 300,000 barrels a day only if 20 per cent of the capacity is taken up by heavy oil. But it rarely reaches that threshold of heavy oil and Allan and Eliesen claim there were 97,000 barrels a day of capacity in the first quarter of 2019 that were not used.

Earlier today, Liberal Leader Andrew Wilkinson issued a statement criticizing the government for the inquiry’s short timeline and terms of reference that limit it from investigating government activity that affects gas prices.

“It is outrageous that an investigation into fuel costs would be barred from considering the impacts of fuel taxes, transit taxes, and the government’s opposition to increasing pipeline capacity,” Wilkinson says.

The inquiry will conclude with a final report by the panel due Aug. 30.

Amy Smart, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Nak’azdli and UNBC form partnership to preserve inter-generational stories

“Stories can empower. Stories can bring people together. Stories can be instructive,”… Continue reading

B.C. premier talks forestry, service needs with handful of northern mayors in Prince George

Prince George meeting completes premier’s tour of Kitimat, Terrace, Fort St. James and Quesnel

Indigenous LNG supporters chide human rights advocates over pipeline comments

Coastal GasLink has signed agreements with 20 elected First Nation councils along the pipeline’s 670-kilometre path

Cluculz Lake fire leads to death of occupant

RCMP said mobile home was engulfed in fire when they arrived on scene

VIDEO: WHO says China virus not global health emergency

The decision came after Chinese authorities moved to lock down three cities on Thursday

Northern B.C. RCMP investigating alleged sexual assault in downtown Smithers

One person was transported by ambulance to hospital following RCMP investigation at Sedaz

Here’s what Canada is doing to stop the coronavirus from getting in

Health officials are monitoring multiple possible cases in Canada

RCMP investigating sexual allegation against Lower Mainland police officer

Delta officer suspended while the alleged off-duty incident involving a co-worker is investigated

VIDEO: Rare ‘ice circle’ spotted on Kamloops river

An ice circle or ice pan, has formed in the chilly waters just east of the Yellowhead Bridge

Investigators in wildfire-torn Australia head to site of B.C. airtanker crash

The B.C. government sends condolences to Port Alberni-owned Coulson Aviation

VIDEO: Person in wheelchair narrowly avoids collision with car in Kelowna

There were no injuries in the scary looking near-accident last week in Rutland

B.C. still struggling to control non-resident medical care fraud

Unpaid bills, out-of-province claimants a costly legacy of MSP

Father to B.C.’s first MLB hall-of-famer is one proud dad

Larry Walker Sr. talks baseball background and son’s base running gaffe

Most Read