LONDON, Ontario – Canada’s gas stations are increasingly becoming divorced from the crude oil producing and refining sectors, according to a recent survey of Canada’s retail gasoline facilities by petroleum consultancy MJ Ervin & Associates.

The total number of retail gasoline stations in Canada stands at 12,285 as of December 31, or 3.5 gas stations for every 10,000 persons. These numbers represent a continuation of a downward trend since 1989, when more than 20,000 stations existed. 

“We have seen virtually no increase in the retail gasoline margin in over 25 years,” said Michael Ervin of MJ Ervin & Associates, in a press release. “Retail gas stations are no longer seen as a strategic asset for integrated oil companies,” since refiners typically have ongoing gasoline supply agreements with several third-party retail chains who themselves do not operate refineries.

Only 14% of Canada’s gas stations come under the direct price control of the three major oil companies (Shell, Suncor and Esso), although their brand names appear on 36% of all gas stations, many of which are price controlled by the local dealer, or by a regional marketer holding the rights to use the major brand on its sign and pumps. 

At the time the study was completed, nine integrated refiner-marketers operated in Canada, representing a total of 15 refineries across the country. Recently, the number of integrated refiner-marketers declined to eight, with the recent split of Valero, the owner of Ultramar, into separate refining and marketing companies. By contrast, there are more than 60 petroleum marketers in Canada who do not operate refineries, and more than 90 distinct brands of gasoline. 

These non-refiner marketers represent 77% of Canada’s retail gas stations, up from 70% in 2006, and reflecting a shift in retail gasoline ownership from refiners to non-refiners. A growing segment of this sector are big box retailers, which have proliferated over the past decade and through competitive pricing and other incentives, has contributed to the overall decline in conventional gas stations.