They say the first casualty of war is truth, and the escalating pipeline battle between B.C. and Alberta seems no exception. Canadians have been repeatedly told the Trans Mountain pipeline expansion will open up lucrative new overseas markets for unprocessed bitumen. This is nonsense.

Tankers loaded with crude from the existing pipeline have been leaving Vancouver for years and virtually all of these shipments have been bound for refineries in the U.S. Several of these plants are just across the border in Washington State and also receive Alberta crude through a connection from the Trans Mountain pipeline to Puget Sound.

Unprocessed Canadian resources are then upgraded at some of the most profitable refining margins in the world and sold back to local captured markets at a steep markup. Is this the national interest that Prime Minister Justin Trudeau Trudeau speaks so urgently of?

The Port of Vancouver recently posted their cargo statistics for 2017, shedding more light on the enduring myth of eager Asian markets for Alberta bitumen.

In 2017, 1,767,672 tonnes of crude petroleum were shipped from Vancouver, with 1,767,592 bound for the U.S. - or 99.99 percent. The remaining 80 tonnes were exported to China with an approximate market value of less than $40,000. If Asian markets will bring higher prices, why aren't companies shipping crude to them now? It seems Asia is unlikely to bring billions in prosperity to Albertans anytime soon.

Equally illuminating was the inbound cargo figures from the United States. Last year the U.S. shipped back about half the export crude tonnage in form of refined oil products, including 456,816 tonnes of aviation fuel, 374,980 tonnes of gasoline and 85,143 tonnes of diesel. Based on current market prices, these products had a pre-tax value of over $1 billion.

In comparison, crude exports to the U.S. of 1,767,672 tonnes or 13 million barrels were worth about $600 million, meaning that imported refined petroleum was worth some three times as much per tonne.

This Canadian resource myopia is a windfall for the five refineries across the border in Washington State, particularly the two owned by Shell and BP tooled up to refine discounted Alberta bitumen and connected to the existing Trans Mountain pipeline that crosses the border at Sumas. Over half of Trans Mountain shipments in 2017 went directly to these U.S. facilities, with additional marine shipments by tanker from Vancouver.

U.S. west coast refineries are among the most profitable in the world due to a relatively captive market and lack of competition. Washington State remains unconnected to Midwest pipeline networks and is a long expensive trip for tankers from the Gulf Coast.

Much of the feedstock has historically been supplied from the Alaskan North Slope or California oil fields, both now in steep decline. The slack has since been taken up by fracked Bakken crude supplied by rail and, increasingly, by Alberta crude supplied either directly by the Trans Mountain pipeline spur to Washington State or by tankers outbound from Vancouver.

How badly is Canada missing out by not refining our own oil? The oil industry has a colourful term called the crack spread to describe the profit margin for refineries between buying crude and selling refined products.

Washington refineries buying Alberta bitumen have some of the largest profit margins in the world - up to $45 US per barrel in 2013. Not surprisingly, Vancouver also has some of the highest retail gasoline prices in North America.

Little wonder some interests are so keen on seeing the Trans Mountain pipeline expansion. According to a recent market research paper bluntly titled Pacific Northwest Refineries: Cheap Crude and a Captive Market "Both Shell and BP were in a strong position to benefit from bargain-priced heavy Canadian crude that the other refiners cannot process in significant quantities due to lack of investment in coking units… If the Trans Mountain pipeline is expanded in 2019 it will provide considerable opportunity to upgrade or expand Puget Sound refineries."

Using the more conservative crack spread of $24 per barrel in 2016, Trans Mountain will create massive potential profits for west coast refiners. With an eventual capacity of 890,000 barrels per day, U.S. refineries could pocket $7.8 billion US per year adding value to Canadian crude that our prime minister seems eager to export unprocessed.

Currently, less than 40 per cent of Alberta's bitumen is upgraded or refined. Shipping raw bitumen through a pipeline also requires expensive and toxic diluent, which occupies about 30 per cent of pipeline volume and creates dangerous complications in the event of a spill.

Alberta Premier Rachel Notley's government has recently suggested it might buy the Trans Mountain pipeline outright to further scale up raw bitumen exports. This is starkly at odds with an announcement earlier this year that the government planned to provide $1 billion in grants and loans to build new upgraders in the province. Or Notley's campaign promise in 2016 to create more refinery jobs in the province "instead of exporting them to Texas."

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Meanwhile U.S. corporations have invested $185 billion in refinery infrastructure while Alberta attracted only $4 billion. The province just saw the first new refinery opened since 1984 in spite of a chorus of local naysayers who derided the project for years.

B.C. has only two remaining refineries, one of which is located in Burnaby just beside the Kinder Morgan terminal. Unionized workers at this plant strongly oppose the Trans Mountain expansion on the grounds it will divert badly needed feedstock to U.S. competitors. The Burnaby refinery has a capacity of only 55,000 barrels per day compared to the combined capacity of 630,000 barrels just across the border. Three other former refineries in Burrard Inlet have closed, apparently due to Trans Mountain's impact on B.C. refining margins. The union has argued in the past that Kinder Morgan's approach favours U.S. refineries.

The enduring myth of Asian markets still seems a useful talking point, judging by how often Canadians hear it in the media. Yet when not badgering the public, the Alberta oil industry is quite candid about sending unprocessed Alberta crude and bitumen to California instead of China. Perhaps that is why so much Canadian effort went into undermining California's low carbon fuel standards.

Instead of putting our coast at risk shipping profits to the U.S., why aren't we expanding local refining capacity? Why are Alberta and Ottawa hell bent on pushing through a pipeline possibly costing billions in public money to export unprocessed Canadian resources?

Consider that non-consensual crack spread next time you bend over to fill up for $1.50 per litre.