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UPDATE 1-South Korea's GS Caltex buys rare Canadian crude cargo for Feb

Published 2017-12-18, 03:29 a/m
© Reuters.  UPDATE 1-South Korea's GS Caltex buys rare Canadian crude cargo for Feb
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* 300,000 bbl Cold Lake crude to arrive in 2nd half of Feb

* GS Caltex trying out heavy crude from Canada -source (Adds comment, shipment details)

By Jane Chung and Florence Tan

SEOUL/SINGAPORE, Dec 18 (Reuters) - South Korean refiner GS Caltex Corp has bought a rare cargo of Cold Lake crude, the company's first purchase in more than two decades of this Canadian oil grade, a company spokesman said on Monday.

The second-largest refiner in South Korea bought 300,000 barrels of the heavy sour crude for delivery in the second half of February, he said.

The refiner is trying out a small volume of the oil, which has a quality similar to that of Iraq's Basra Heavy crude, a person familiar with the matter said, speaking on condition of anonymity because he wasn't authorised speak to media.

About 300,000 barrels of Cold Lake were loaded onto Panamax Selecao on Dec. 13 at Vancouver for delivery to an unspecified destination, trade flows data on Thomson Reuters Eikon showed.

One trading source said the arbitrage window might have briefly opened when the discount between U.S. West Texas Intermediate crude and Brent futures CL-LCO1=R stretched as wide as $7 a barrel last week on a disruption in Forties crude supply. crude produced in Canada is trading close to its deepest discount in four years as pipeline constraints pushed western Canadian crude inventories to record highs. Caltex operates a 790,000 barrels per day refinery in Yeosu. The refiner is equally owned by GS Energy Corp, a unit of GS Holdings 078930.KS , and U.S. oil major Chevron Corp (NYSE:CVX) CVX.N .

Another South Korean refiner Hyundai Oilbank Corp has also expressed interest in purchasing Canadian crude.

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