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The final investment decision by Canada Kuwait Petrochemical Corporation (CKPC), which includes Calgary-based Pembina Pipeline Corp., will see construction of a petrochemical upgrading facility in Sturgeon County.
At the peak of construction, more than 3,000 workers will be on site, with the project expected to create over 200 full-time operations and head office jobs upon completion.
“Led by thousands of Alberta workers and a Calgary-based company, this project is truly Made-in-Alberta. By adding value to resources owned by all Albertans, we’re putting economic diversification first and seizing opportunities to upgrade more resources right here in this province.”
The complex will process about 23,000 barrels per day of Alberta propane into polypropylene, which is a much higher-value plastic material used around the world to make products such as food packaging, auto parts and electronics.
CKPC was approved in 2016 to receive up to $300 million in royalty credits under the first Made-in-Alberta program to encourage private investment in petrochemical upgrading.
“This announcement is the culmination of many years of hard work with our partner to develop a project that is well-positioned to capitalize on Alberta’s abundant supply of propane and undertake value-added processing that benefits all Albertans. We want to thank the Government of Alberta for providing the incentive and vision that has helped make this investment a reality and we want to particularly thank the selection panel for their hard work and the consideration of Pembina’s application.”
Construction is expected to start in 2019, with the complex fully operational by mid-2023. The project will receive royalty credits after the facility has been constructed and is in operation.
Another project, Inter Pipeline’s $3.5-billion Heartland Petrochemical Complex, is already under construction near Fort Saskatchewan as a result of this program. The complex is a similar gas-to-plastics operation, employing about 2,300 people during construction with 180 full-time jobs upon completion.
- Two projects – CKPC and Inter Pipeline – were selected under the first round of this program, which was announced in 2016, for a combined $8 billion in private investment.
- The government announced a second round of support for petrochemical upgrading in 2018, with total support now reaching $2.1 billion to unlock about $20 billion in private-sector investment.
- This would help create as many as 15,500 jobs during construction of multiple petrochemical facilities across the province.
Partial upgrading of bitumen
- $1 billion in grants and loan guarantees to encourage companies to build bitumen-upgrading facilities
- Partial upgrading reduces the thickness of oil sands bitumen so it can flow through pipelines more easily, without having to be blended with diluent, or as much diluent, a thinning agent. Benefits include:
- increased prices for our resources before shipping
- up to 30 per cent more capacity on existing pipelines
- more refineries around the world capable of processing our product
- cost savings on diluent for industry
- fewer emissions by removing high carbon content