Petro-Canada was founded as a Crown Corporation in 1975 by an act of Parliament. Most of the original Petro-Canada stations were British Petroleum Canada (BP Canada) dealers, and BP disappeared from the retail scene in Canada soon after. Later, Petro-Canada acquired the Canadian retail stations of Gulf and Fina.
Canada's large oil reserves had long been under the control of American corporations who geared most of their production towards the American market, and sent their profits south. After the oil shock of 1973 oil prices quadrupled, but little of the benefit was going to Canadians. The motion to create a publicly-run oil company was introduced by the New Democratic Party in 1973, Prime Minister Pierre Trudeau's Liberals were then in a minority government and dependent upon the support of the NDP to stay in power. The idea also fit with Trudeau's economic nationalism.
The company was given $1.5 billion in start-up money and easy access to new sources of capital. It was set up in Calgary, despite the hostility of that city's population and existing oil firms. Its first president was Liberal operative Maurice Strong. The government maintained closer controls over Petro-Canada than was usual for a Crown Corporation so they could use it as a policy tool. The Progressive Conservative Party, led by Albertan Joe Clark, was an opponent of the company, and advocated breaking it up and selling it. The Tories were unable to proceed with these plans during their brief time in power in 1979-1980, however.
The company became popular outside Alberta as a symbol of Canadian nationalism. The federal government and Petro-Canada tried to re-inforce this popularity nationwide (but especially in Calgary) through its prominent sponsorship of the city's successful 1988 Winter Olympics bid. It quickly grew to be one of the largest players in the traditional oil fields of the west as well as in the tar sands and the East coast offshore oil fields.
When the Liberals returned to power in 1980, energy policy was an important focus, and the sweeping National Energy Program was created. This expanded Petro-Canada, but it was detrimental to Alberta's economy. The government of Prime Minister Brian Mulroney (1984-1993) stopped using Petro-Canada as a policy tool, and it began to compete fully and successfully with the private sector
In 1990, the government announced its intention to privatize Petro-Canada and the first shares were sold on the open market in July 1991, at $13 each. The government began to slowly privatize the company, selling its majority control, but keeping a 20% stake in the company. No other shareholder is allowed to own more than 10%, however. Also foreigners cannot control more than 25% of the company.
During the first year, the value of the shares gradually dropped to $8 as Petro-Canada suffered a huge loss of $603 million, primarily because of the devaluation of some assets. The newly-private company significantly reduced the number of properties in which it had a direct interest. It reduced its annual operating costs by $300 million and it went from a staff of close to 11,000 to only about 5,000 employees. Many of these laid off employees went on to work and start up other oil companies in Alberta creating a new group of Canadian producers.
In his 2004 federal budget, Finance Minister Ralph Goodale pledged to sell the government's remaining stake in the company.
Petro-Canada is Canada’s second-largest downstream company with refining and supply operations, retail and marketing networks, and a specialty lubricants business. It has a loyalty program called Petro Points where the customers get points for fuel, car repair and store purchases. It teamed up with Citibank for a Petro Points MasterCard. One of the benefits is 2 cents off a litre for fuel purchases and Petro Points for all purchases on the card. Petro-Canada also runs a chain of car repair with their stations called Certigard Car Repair.
Today Petro-Canada is Canada's 11th largest company with important interests in such projects as Hibernia, Terra Nova, and White Rose; its gas stations remain a presence in most Canadian cities. It owns refineries in Edmonton, Alberta (135,000 bpd) and Montreal, Quebec (155,000 bpd), accounting for 16% of the Canadian industry’s total refining capacity. Its lubricants plant in Mississauga, Ontario refines crude oil feedstock to produce lubricating oil-based stocks and other specialized products.
The company has expanded internationally and is involved in several foreign projects, especially in Algeria, the Netherlands, Tunisia, the United Kingdom, Syria, Italy, Libya, Trinidad and Tobago, and Venezuela. These and all the other sites outside of North America are run by the International Business Unit of Petro-Canada with its headquarters in London Bridge, London.
Its main gasoline additive is Tactrol.
In 2006 the company entered the mobile phone market with a pre-paid service called Petro-Canada Mobility.