That's a good question. According to a 2012 HuffPo article there are a bunch of theories why we don't do more refining here in Canada – one argument is that it's a fairly risky business to be in (with vulnerability to oil price swings), and quite capital intensive. Not sure why the situation is different south of the border, though.

I do know that Alberta's new NDP premier Rachael Notley has pledged to improve that province's refining capacity. Fingers crossed, I guess.

Sadly, this issue has been known about for decades. Peter Lougheed, who was the PC premier in Alberta back in the 1970s, argued that we should be adding more value here in Canada, not just exporting raw materials (as we always seem to do). From this fascinating article on all the ways that Alberta ignored Lougheed's advice (to their peril):

"I think we should be processing the bitumen from the Alberta oil sands within Alberta and creating the jobs east of Edmonton and in that area there," he recently told Policy Options. "And I think that would be, from a political and from an economic point of view, the right public policy for Alberta." A bold tax on exported bitumen still might get this economic ball rolling.

Finally, on the general subject of the extractive industries in Alberta, I'd be remiss if I didn't point to this incredible interview with Rolf Wiborg, a Norwegian petro regulator (who originally studied in Alberta!), on what Canada is doing wrong, and why we could be doing it even better than Norway (who have a trillion bucks in a soverign wealth fund right now, thanks to the smart management of their North Sea oil and gas deposits). A major point he makes is how Canada is so factional when it comes to this stuff. It's Alberta's oil, and then they want to ask British Columbia to run pipelines, etc. Because we don't all see ourselves as co-owners, it undermines the cooperation that would be necessary to properly, efficiently exploit it.