: : R E D E F I N I N G T H E H E A R T L A N D : : M AY 2 0 1 3 : :
Shifting
focus The Heartland has diversified its post-recession focus, but upgrading isn’t completely off the
PM40069240
books just yet
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The boom is back Alberta’s Heartland is ramping up for another busy season of projects
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Painting the Heartland green As new projects are planned for the Heartland, the need for environmentally friendly technologies is becoming more important
CELEBRATING 15 YEARS
ALBERTA’S INDUSTRIAL HEARTLAND ASSOCIATION
The power of municipal collaboration has been a unique part of Alberta’s Industrial Heartland for fifteen years. The region’s economic prosperity, vibrant innovation, and community commitment demonstrate the municipal partnership’s true achievements.
FIFTEEN years ago Alberta Premier Ralph Klein applauded the partnership, saying “This is a fine example of what Albertans do best – work together. These municipalities are building on the key strengths of our Alberta Advantage. And they have also added another element to our advantages – local cooperation for better long-term, regional growth.” – May, 1998
FIVE municipalities Municipal cooperation enhances business attraction, improves planning, and ensures complementary use of resources. Collaboration has helped the region evolve into Canada’s largest hydrocarbon processing centre with over $30 billion in capital investment.
ONE favorable future The Association is committed to promoting the region’s advantages and opportunities. This includes enhancing value adding, not just in oil and gas sectors, but chemical, petrochemical, and agriculture as well. The process of adding value benefits the entire province and country by creating long term jobs, growth and revenue, and diversifying our markets and customers. For more information about Alberta’s Industrial Heartland Association, visit www.industrialheartland.com.
www.industrialheartland.com inquiries@industrialheartland.com 780.998.7453
The Association’s Members – Counties of Lamont, Strathcona, and Sturgeon, along with Cities of Edmonton and Fort Saskatchewan – are joined by Associate Members – Towns of Bruderheim, Gibbons, and Redwater – in promoting and coordinating sustainable development of the region.
COntentS EDITORIAL EDITOR
Rianne Stewart | rstewart@junewarren-nickles.com CONTRIBUTING WRITERS
Jim Bentein, Melanie Collison CONTRIBUTING PHOTOGRAPHER
Darryl Zubot EDITORIAL ASSISTANCE MANAGER
Marisa Sawchuk | msawchuk@junewarren-nickles.com EDITORIAL ASSISTANCE
Laura Blackwood, Sarah Eisner CREATIVE PRINT, PREPRESS & PRODUCTION MANAGER
Michael Gaffney | mgaffney@junewarren-nickles.com CREATIVE SERVICES MANAGER
Tamara Polloway-Webb | tpwebb@junewarren-nickles.com CREATIVE LEAD
Contents
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Cathlene Ozubko GRAPHIC DESIGNER
Jeremy Seeman CREATIVE SERVICES
Jenna O’Flaherty
Alberta’s Industrial Heartland If you’re building an industrial project, the Heartland is the place to be
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What is Alberta’s Industrial Heartland? Heartland by the numbers
By Rianne Stewart
SALES SALES MANAGER—ADVERTISING
Monte Sumner | msumner@junewarren-nickles.com SENIOR ACCOUNT EXECUTIVES
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Shifting focus The Heartland has diversified its postrecession focus, but upgrading isn’t completely off the books just yet By Jim Bentein
Denise MacKay | atc@junewarren-nickles.com DIRECTORS CEO
Bill Whitelaw | bwhitelaw@junewarren-nickles.com PRESIDENT
Rob Pentney | rpentney@junewarren-nickles.com DIRECTOR OF SALES & MARKETING
Maurya Sokolon | msokolon@junewarren-nickles.com DIRECTOR OF EVENTS & CONFERENCES
Ian MacGillivray | imacgillivray@junewarren-nickles.com DIRECTOR OF THE DAILY OIL BULLETIN
Stephen Marsters | smarsters@junewarren-nickles.com DIRECTOR OF DIGITAL STRATEGIES
Gord Lindenberg | glindenberg@junewarren-nickles.com DIRECTOR OF CONTENT
Chaz Osburn | cosburn@junewarren-nickles.com DIRECTOR OF PRODUCTION
Audrey Sprinkle | asprinkle@junewarren-nickles.com DIRECTOR OF FINANCE
Ken Zacharias, CMA | kzacharias@junewarren-nickles.com
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The boom is back Alberta’s Heartland is ramping up for another busy season of projects
Painting the Heartland green As new projects are planned for the Heartland, the need for environmentally friendly technologies is becoming more important By Jim Bentein
OFFICES CALGARY
2nd Flr-816 55 Avenue NE | Calgary, Alberta T2E 6Y4 Tel: 403.209.3500 | Fax: 403.245.8666 Toll-free: 1.800.387.2446 EDMONTON
220-9303 34 Avenue NW | Edmonton, Alberta T6E 5W8 Tel: 780.944.9333 | Fax: 780.944.9500 Toll-free: 1.800.563.2946 GST Registration Number 826256554RT. Printed in Canada by PrintWest. ISSN 1204-4741 | © 2013 JuneWarren-Nickle's Energy Group. All rights reserved. Reproduction in whole or in part is strictly prohibited. Publications Mail Agreement Number 40069240. Postage paid in Edmonton, Alberta, Canada. If undeliverable, return to: Circulation Department, 80 Valleybrook Dr,
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Going old school Lime plant contributes to big development news for Alberta’s Heartland By Melanie Collison
North York, ON M3B 2S9. Made in Canada. PHOTO: ??????????
The opinions expressed by contributors to this publication may not represent the official views of the magazine. While every effort is made to ensure accuracy, the publisher does not assume any responsibility or liability for errors or omissions.
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H e a rt l a n d 1 0 1
PHOTO: DARRYL ZUBOT
a
The Scotford refinery, located right in the heart of the Industrial Heartland area, will be a key player in the move to reduce emissions using carbon capture and storage.
sk people about the best places to do business right now in Alberta and most would immediately think of the oilsands. Yet not far from the province’s bitumenrich region, just a short drive away from the provincial capital, there is a thriving economic powerhouse that is already host to several major industrial corporations—with more on the way in the coming decades. The Industrial Heartland of today is the product of a 1998 agreement that created the Alberta’s Industrial Heartland Association (AIHA). Initially, the partnership was between four municipalities (Fort Saskatchewan, Lamont County, Strathcona County and Sturgeon County), and support by three levels of government and the Northeast Capital Industrial Association. In the past 15 years, one more municipality (the City of Edmonton) and three associate members (Bruderheim, Gibbons and Redwater) have joined, and the area has become an industrial epicentre with more than $30 billion worth of capital investment. The association ensures responsible and efficient development for its members, while also promoting economic activity in the area through such initiatives as its Alberta Plus marketing campaign. The campaign focuses on four areas: economics, environment, careers and job security. “The goal of our board really was to bring the Alberta heartland to its A-game,” Linda Osinchuk, AIHA chair and mayor of Strathcona County, told the Daily Oil Bulletin early this year. “We’re there, but now it’s time to take it to the A-plus game, and that’s what this campaign is going to do.” Just seven years ago, the area’s focus was on upgrading and refining crude, but now the AIHA is working to diversify the local economy to create a more stable environment that isn’t so dependent on energy prices. However, even if the area can’t fully insulate itself from commodity price shocks—the majority of the new projects announced for the region are still oil- and gas-related—the Heartland will be doing more than just upgrading. There is already movement in the areas of carbon capture and storage and off-gas processing, for instance. The Heartland is also experiencing an influx of green technologies and environmentally friendly industrial processes. Every project currently planned for the area in the coming years has a green component and will help mitigate some of the environmental impacts of the nearby oilsands. Besides the jobs and booming economy that come with industrial development, the Heartland is home to numerous recreation facilities, provincial parks and museums. Its communities, like Fort Saskatchewan and Lamont, are the towns rural Alberta is known for, complete with quaint main streets and weekly farmers’ markets. Over 1.1 million people call the greater Edmonton area home, and help supply the Heartland region’s ever-expanding list of industrial projects with a skilled workforce. With more companies setting up shop in the region in the coming years, the number of families living there will also grow—all of which is good news for Alberta’s economy.
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What is Alberta’s Industrial Heartland?
Town of Redwater
4
Sturgeon County
7
6
Town of Gibbons
1
Town of Bruderheim
2
Lamont County The area governed by Alberta’s Industrial Heartland Association is outlined in black.
City of Fort Saskatchewan
Municipal members: 5
City of Edmonton
1
City of Fort Saskatchewan
3
Population: 20,000
Strathcona County
Size: 46.4 square kilometres Companies active in the area: Sherritt International Corporation, The Dow Chemical Company, Agrium Inc. Landmarks: Dow Centennial Centre, historical CN station Interesting: throughout the summer, a herd of 40 sheep maintain the town’s grass and weeds AIH representative: Mayor Gale Katchur
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Lamont County
Population: 8,500 Size: 2,474 square kilometres Companies active in the area: Canexus Chemicals Canada LP, Tervita Corporation, Triton Fabrication Inc. Interesting: Lamont County is known as the “Church Capital of North America,” as it has more churches per capita than anywhere else in North America—47 in total AIH representative: Reeve Wayne Woldanski
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Strathcona County
Population: 92,400 Size: 1,265 square kilometres Landmarks: Ardrossan Recreation Complex Interesting: Strathcona County has seen population growth of 12 per cent since 2008, making it Alberta’s third-largest municipality in terms of population AIH representative: Mayor Linda Osinchuk
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Sturgeon County
City of Edmonton
Population: 19,000
Population: 1,300,000
Size: 2,100 square kilometres
Size: 9,426.7 square kilometres
Companies active in the area: Agrium Inc.
Companies active in the area: TBD
Landmarks: Country Soul Stroll agricultural driving tour, Cardiff Park
Landmarks: Art Gallery of Alberta, Royal Alberta Museum, West Edmonton Mall, Fort Edmonton Park
AIH representative: Mayor Don Rigney
AIH representative: Mayor Stephen Mandel
Associate members:
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7
Town of Gibbons
Town of Bruderheim
Population: 3,030
Population: 1,300
Size: 7.39 square kilometres
Size: 4.23 square kilometres
Landmarks: Jurassic Forest, Goose Hummock Golf Course
Landmarks: Spring Creek Wetland Interpretive Centre, Bruderheim Heritage Trail, Walker School Museum, Canadian Moravian Museum
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Town of Redwater
Population: 2,116 Size: 20.12 square kilometres Landmarks: Pembina Place, Redwater Museum
Proud to be part of the development of Alberta’s Industrial Heartland
Ph: 1-866-454-4717
www.progressland.com O I LS A N D S R E V I E W | rede f inin g t h e h ear t land | M AY 2 013
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H e a rt l a n d 1 0 1
HEARTLAND
by the
NUMB3R$
The Heartland area covers
over 40
are in the City of Edmonton
Taxes paid by industry to Heartland municipalities exceeded
$77 MILLION in 2012 Annual local spending by industry in the Heartland area for goods and services is greater than
industrial companies are active in the Heartland region
Industrial activity in the Heartland began in
1952
Industrial activity in the Heartland region employs over
7,000 people 6,100+ people
$900 MILLION over $30 billion
rely on industry in the Heartland region for their livelihood
has been invested in the region to date
SOURCES: ALBERTA’S INDUSTRIAL HEARTLAND ASSOCIATION; NORTHEAST CAPITAL INDUSTRIAL ASSOCIATION
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The Port of Thunder Bay
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Best choice for project cargo Direct route to the oilsands via upgraded rail corridor Minimize handling, time and cost Staging area and storage available Liebherr LHM 320 mobile harbour crane
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ATCO Pipelines Providing reliable, efficient delivery of natural gas - committed to operational excellence and superior customer service while ensuring the safety of our employees and the public.
HABITS of Strathcona County People
Habit 4: Think Win-Win Also think, ‘Yeah baby!’ Celebrate. You’ve worked hard, kept your head down, overachieved in all you’ve pursued. Lofty goals and raw ambition pepper your life’s report card. Now…reap your reward. It’s called Strathcona County…‘the good life’. But there’s also a humble heartbeat here that grounds you and your children in authenticity. We are salt of the earth, with values and traditions that nourish life and living. Knowing neighbours still matters. Giving back and paying it forward matter even more. Truth, beauty and goodness flourish here, powered by people like you.
Check us out. You owe it to yourself. www.strathcona.ca
ATCO Energy Solutions Providing natural gas liquids extraction, industrial water infrastructure, electric transmission and substations, and energy storage & logistics solutions.
ATCO Power Developing and operating high efficiency industrial scale power generation projects to supply reliable, low cost electricity to Alberta’s primary industries.
ATCO IS ...
Energizing Alberta’s Industrial Heartland ENERGY | UTILITIES | STRUCTURES & LOGISTICS | TECHNOLOGIES
WWW.ATCO.COM
The Heartland region had expanded from a single company in the 1950s to an industry cluster that has attracted world attention since the 1990s. Created in May 1998, Alberta’s Industrial Heartland Association is celebrating its 15th anniversary this year.
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SHIFtInG FOCUS
The Heartland has diversified its post-recession focus, but upgrading isn’t completely off the books just yet By Jim Bentein
S
ix years ago, those in the Alberta construction industry were fretting about whether or not there would be enough skilled workers to build the seven oilsands upgraders planned for the Industrial Heartland region and the impact a shortage might have on construction costs. But then, in the words of Neil Shelly, executive director of Alberta’s Industrial Heartland Association (AIHA), “that horse left the barn.” One after another, the projects worth billions of dollars dropped off. In November of last year, one horse—the Sturgeon Refinery— came back into the barn, followed by speculation early this year of another—the BA Energy Inc. Upgrader—following its lead.
PHOTO: DARRYL ZUBOT
Renewed hope
In early November, the North West Redwater Partnership (NWR) announced that its Sturgeon Refinery, a $5.7-billion project that could lead to billions more in investment, will go ahead. “I can’t even estimate the total economic impact, but it will be in excess of $50 billion and closer to $100 billion and beyond,” says Ian MacGregor, chairman of North West Upgrading Inc. NWR is a wholly owned subsidiary of Calgary-based North West Upgrading and
Canadian Natural Upgrading Limited, which, in turn, is a subsidiary of oilsands producer Canadian Natural Resources Limited. The project is to be built in Sturgeon County, near the existing Agrium Inc. fertilizer complex, and it promises to transform the economy of the Heartland, says Shelly. “It has been a long trip [North West has been working on the project since 2004], but this is really good news for the Heartland and the province as a whole,” he says. The long-planned oilsands bitumen upgrader will be the first project of its type to capture large volumes of CO2, which will be put to use by the province’s first CO2 pipeline, the Alberta Carbon Trunk Line (ACTL), according to MacGregor. “We will be capturing enormous quantities of CO2,” says MacGregor. “Initially we will capture 3,500 tonnes of CO2 per day, but with all three phases we could capture up to 11,000 tonnes. That’s equal to the emissions from all the cars in Alberta. This is an important project for Alberta. It’s being done by Albertans. We live here and we wanted to do the right thing.” Construction on the project, which MacGregor says will employ 8,000 construction workers at its peak, was scheduled to begin this spring. It will take three years to build the huge project, which is being constructed
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SHIFtInG FOCUS
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Opportunities galore
Unlike most CO2 produced by conventional upgraders, which is mixed with nitrogen and other elements, the CO2 produced by the Sturgeon Refinery is considered pure and is therefore suitable for enhanced oil recovery (EOR)—making it a valuable product that will eventually generate huge amounts of revenue. The CO2 will be sold to Enhance Energy Inc., which is currently developing the 240kilometre, 16-inch-diameter ACTL. The line will eventually transport CO2 from the Agrium fertilizer plant near Redwater and from the Sturgeon Refinery to be used for EOR in depleted oil reservoirs in central Alberta. Enhance has received a commitment of $495 million from the Alberta government’s $2-billion Carbon Capture and Sequestration Fund for the $1.3-billion project. MacGregor, who is also chairman of the board at Enhance, says the ACTL project will be adjusted to fit the schedule of the Sturgeon Refinery. It will be designed to ultimately move 40,000 tonnes per day of CO2.
Talk of the town
The proposed BA Energy Upgrader, a 260,000-barrel-per-day project planned by Calgary-based, privately owned Value Creation Inc., may also be back in the barn after being shelved in 2008 following the credit crisis. “We are still planning to build it and we are working on securing a partnership,” says Value Creation chief executive officer Columba Yeung. The $1-billion-plus upgrader, on which Value Creation subsidiary BA Energy spent $600 million before the 2008 credit crisis hit (forcing the subsidiary to seek creditor protection in January 2009), is still economically viable, Yeung says. “Capital costs and operating costs are less than half of those with a conventional upgrader,” he says. Value Creation, which has since recapitalized after BP Canada Energy injected
PHOTO: DARRYL ZUBOT
in three 50,000-barrel-per-day phases for total capacity of 150,000 barrels per day. MacGregor says it’s important to understand that the company isn’t just developing an upgrader to turn bitumen into a lighter, refinery-ready crude, as all other planned and existing upgraders in the province do. “Most refineries in North America were designed to produce gasoline, but we are responding to the market in western Canada,” says MacGregor. “We’re producing 40,000 barrels per day of diesel [from the first phase], and diesel is a high-margin product that is in great demand in western Canada.” Another key technological part of the refinery’s design is that it will deploy gasification, which means the upgrader won’t need to rely on natural gas as a source of hydrogen for the process. Instead of producing dry coke as a by-product, North West will transform hot liquid bottom ends into hydrogen, oxygen and 99.5 per cent pure CO2. It will also produce 10,000 barrels per day of lubricants, which could spawn the development of a lubricants plant.
Shelly predicts the Sturgeon Refinery will bring numerous economic benefits to the Heartland area and the rest of Alberta, including about 800 permanent direct jobs—600 of those in the Heartland and 200 in Calgary. Enhance president and chief executive officer Susan Cole echoes this, estimating 97,000 person-years of employment during the refinery’s construction phase and 307,000 person-years of employment during the first 30 years of operation. And because large industrial plants tend to have a “multiplier effect,” creating many spinoff jobs, Shelly says there will be three times that many permanent positions for everyone from environmental consultants to truck drivers and restaurant workers. A recent AIHA study also showed the project would generate $1.2 billion in provincial and federal tax revenue. North West recently calculated that if the Sturgeon Refinery had been operating in 2011, the government would have collected $500 million, Shelly says. In addition, the Alberta government, through the Alberta Petroleum Marketing Commission, which collects bitumen from producers in lieu of royalties through the Bitumen Royalty in-Kind program, stands to benefit directly from the project’s profits. The Alberta government will supply 37,500 barrels per day of collected bitumen to be upgraded, while Canadian Natural has agreed to supply 12,500 barrels per day.
S hif t i n g focus
The Sturgeon Refinery Owners: North West Upgrading Inc., Canadian Natural Resources Limited Capacity: 150,000 barrels per day in three phases ill receive some of its feedstock volumes from the Government of Alberta’s W Bitumen Royalty in-Kind program First 50,000-barrel-per-day phase sanctioned in fall 2012, start-up expected in 2016
$900 million into the company to buy 75 per cent of its Terre de Grace lease, announced in late 2012 it would spend $3.39 billion to develop its TriStar oilsands project near Fort McMurray.
Diversifying the Heartland The Heartland’s proximity to Alberta’s oilsands means the area sees plenty of industry spinoffs—and will likely see a lot more in the future. As technology and processes are developed to reduce the environmental impact of the Heartland area’s refining and petrochemical industries, the area is seeing focus on CO2 capture and off-gas processing projects, as well as on a new cluster of value-added projects linked to Alberta’s abundant and low-cost
and refineries in the region, and they all produce CO2 emissions,” he says. “Now, because we will have the infrastructure to capture CO2 emissions, many industries that may not have considered locating in the area in the past will now look here.” In addition, reducing CO2 emissions and other environmental impacts from oilsands development, in which Heartland industries will play a key role, will prove to be vital as more states and provinces shun oilsands crude because of its environmental footprint. “It’s not just a financial issue, it’s an access issue,” he says. One of the CO2 capture-related de velopments slated for the Heartland region is the Quest Project, which will capture 1.2 million tonnes of CO2 per year from
Construction has begun and will employ 400 skilled workers over 30 months, peaking at about 700 workers. Shell has also contracted with Aux Sable to move CO2 from the Scotford refineryupgrader to an off-gas processing facility operated by Aux Sable. The firm breaks off-gas down into ethane and other valueadded products, as well as hydrogen, which is returned to Shell for use in its refinery. The Aux Sable plant employed a peak construction workforce of 124 and now employs 11 permanent staff. In addition, plans by South African–based Sasol Limited to develop Canada’s first natural gas–to-liquids conversion project in the area, which itself is a multi-billion dollar development, could lead to a “value chain” of new
“ Because we will have the infrastructure to capture CO2 emissions, many industries that may not have considered locating in the area in the past will now look here.” — Neil Shelly, executive director, Alberta’s Industrial Heartland Association
natural gas production. The off-gases and captured CO2 not only support EOR, as well as the province’s existing petrochem ical industry, but would also foster a whole new industry built around space-age plastics and other products. Shelly points to the CO2-related projects as a key element in the Heartland’s future. “There are a number of petrochemical plants
Shell Canada Limited’s Scotford refineryupgrader, with that CO2 being stored 2,300 metres below ground. The province will provide $745 million and the federal government $120 million towards the $1.35-billion project being developed by partners Shell, Chevron Canada Limited and Marathon Canada Limited. The CO2 will be transported via an 80-kilometre pipeline.
natural gas liquids–related petrochemical projects, Shelly says. Shelly says the “greening” and diversifying of the petrochemical and oilsands industries will lead to significant spinoff developments in the Heartland, with one recent study showing 35 different petrochemical companies that could be attracted to the region because of its growing CO2 capture and oilsands off-gas infrastructure.
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Edmonton ENERGY AND TECHNOLOGY PARK A premier eco-industrial development opportunity in Alberta’s Industrial Heartland
Sustainable land use and sustainable facility design Petrochemical, manufacturing,
transportation and R&D precincts
12,000 acres (20 square miles)
of greenfield, privately-owned land with an Area Structure Plan in place in northeast Edmonton
Edmonton - Primed for more industrial growth
Part of Alberta’s Industrial Heartland with easy access to feedstock as well as distribution and supply opportunities Connected to the northern oil sands supply chain and logistics corridors, and to the city of Edmonton for labour, equipment and City services www.edmonton.ca/eetp
H e a r t l a n d P r O J e C t U P d at e
Alberta’s Heartland is ramping up for another busy season of projects
F
rom refineries and upgraders to pipelines and lime processing plants, the list of projects being planned for Alberta’s Industrial Heartland region is impressive. And for every project that goes ahead, the Heartland will see development of related projects—meaning the list below is only just the beginning of something big for the region. Here’s a look at some of the proposed or underconstruction projects seeing action in the Heartland area.
STURGEON REFINERY
UPGRADERS AND REFINERIES Developed by: North West Redwater Partnership (subsidiary of North West Upgrading Inc. and Canadian Natural Upgrading Limited, a subsidiary of Canadian Natural Resources Limited) Capacity:
50,000 bbl/d
Bruderheim
X3
Lamont
Location:
Ft. Saskatchewan
Cost:
Sturgeon County
Three phases of 50,000 barrels per day of crude oil (150,000 barrels per day total)
The Sturgeon Refinery will produce 40,000 barrels per day of diesel, and will be the first of its kind to capture large volumes of CO2. The CO2—up to 11,000 tonnes per day—will be transported by the Alberta Carbon Trunk
Operational:
$5.7 2016 BILLION (first phase)
Line (see page 17) and be used for enhanced oil recovery in southern Alberta. Construction was scheduled to begin in spring 2013 and will employ over 8,000 people at its peak.
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H e a r t l a n d P r O J e C t U P dat e
BA ENERGY UPGRADER
UPGRADERS AND REFINERIES Developed by: Value Creation Inc. Capacity:
Cost:
Bruderheim Lamont
Location:
Ft. Saskatchewan
STRATHCONA County
260,000
Construction was suspended in 2008 due to financial constraints, but the company recently announced that it was actively seeking investment and
bbl/d
Operational:
$1+ TBD BILLION
would resume construction once secured. The BA Energy upgrader will produce synthetic crude oil and synthetic diluent.
GAS-TO-LIQUIDS PROCESSING PLANT
OFF-GAS PROCESSING Developed by: Sasol Limited Capacity:
Bruderheim Lamont
Location:
Ft. Saskatchewan
STRATHCONA County
500 MILLION cubic feet per day
If this project goes ahead, Sasol will build the first gas-to-liquids facility in Canada. Initial plans predict producing 48,000 barrels per day of diesel, naphtha and liquefied petroleum gas from the first phase. The company estimates that
Cost:
Operational:
$4+ TBD BILLION
the facility will produce 500 new permanent jobs and employ over 5,000 at its peak construction. The company has determined a project site but has delayed project plans for at least one year to focus on its operations in Louisiana.
KEYERA DE-ETHANIZER
OFF-GAS PROCESSING Developed by: Keyera Corp. Capacity:
Lamont
Location: Ft. Saskatchewan
Fort saskatchewan, alta.
30,000
bbl/d of ethane-rich natural gas liquids
Plans to add a de-ethanizer component to Keyera’s existing natural gas liquids facility would mean a new source of ethane for petrochemical facilities in the area, as well as supply of propane-rich natural gas liquids for the company’s
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Operational:
$110 2014 MILLION mid
Bruderheim
Cost:
fractionation plant. The company estimates a peak construction workforce of 200 employees, with a permanent workforce of 60. Engineering for the project is currently underway.
H e a r t l a n d P r O J e C t U P d at e
WILLIAMS DEHYDROGENATION FACILITY
OFF-GAS PROCESSING Developed by: Williams Energy (Canada) Inc.
Location:
Redwater
strathcona county
Capacity:
Cost:
Operational:
$900 2016 MILLION 2nd quarter of
1.3 BILLION
Bruderheim Lamont
barrels of propylene
The company will use propane recovered from its existing off-gas facility to produce polymer-grade propylene. Williams is currently the only company in Canada that currently produces polymer-grade propylene. The plant’s
by-products will include hydrogen, butane/butylenes and condensate. The project was sanctioned in March 2013 and is currently undergoing the consultation process.
ALBERTA CARBON TRUNK LINE Redwater
CO2 CAPTURE AND STORAGE PROJECTS Developed by: Enhance Energy Inc.
Bruderheim
Edmonton
Capacity: Leduc
Cost:
Tofield
Location:
Camrose
redwater to clive, alta.
14.6 MILLION
Clive
tonnes of CO2 per year
Lacombe
This 240-kilometre pipeline will transport CO2 captured at Agrium Inc.’s Redwater fertilizer plant and the under-construction Sturgeon Refinery to aging reservoirs
Operational:
$1 TBD BILLION
in southern Alberta for use in enhanced oil recovery and for permanent storage. Project plans are dependent on the timing of the Sturgeon Refinery.
QUEST
CO2 CAPTURE AND STORAGE PROJECTS Developed by: Shell Canada Limited, Chevron Corporation, Marathon Petroleum Corporation Capacity:
Cost:
Bruderheim Lamont
Location:
Ft. Saskatchewan
Strathcona County
1 MILLION cubic feet per year of CO2
As a fully integrated carbon capture and storage project, Quest will capture CO2 from Shell’s Scotford upgrader-refinery before transporting it 80 kilometres north of the facility and injecting it underground (2,300 metres below the surface) to be stored permanently in impermeable geological formations.
Operational:
$1.35 2015 BILLION
Quest received support from the Alberta government’s Climate Change and Emissions Management Fund ($74.5 million), as well as $120 million from the federal government. The project began construction in September 2012 and is expected to have a peak construction workforce of 700.
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H e a r t l a n d P r O J e C t U P dat e
GRAYMONT LIME HYDRATING FACILITY
OTHER PROJECTS Developed by: Graymont Western Canada Inc. Capacity:
Lamont
Location: Location:
Ft. Saskatchewan
lamont lamontcounty county
Operational:
TBD TBD 2014 late
Bruderheim
Cost:
The Graymont facility will process and distribute lime, which is used for separating calcium, magnesium, silica and other contaminants out of produced
water to prevent scaling buildup in SAGD boilers. Regulatory approvals have been filed. Once received, construction is expected to begin in mid-2013.
HI-Q FIELD DEMONSTRATION PROJECT
OTHER PROJECTS Developed by: MEG Energy Corp. Capacity:
Lamont
Location:
Ft. Saskatchewan
lamont county
3,000
bbl/d of diluted bitumen
Co-funded by Alberta Innovates – Energy and Environment Solutions, Sustainable Development Technology Canada and MEG, the pilot project will be used to research and apply MEG’s new technology for converting diluted
$103.6 2014 MILLION
bitumen into heavy crude oil. The process emits 44 per cent fewer emissions than conventional upgrading processes. Regulatory approval applications have been filed and are expected to come through in mid-2013.
GRAND RAPIDS PIPELINE
OTHER PROJECTS Developed by: TransCanada Corporation and Phoenix Energy Holdings Limited
Ft. McMurray
Location:
Athabasca
Pump stations
Capacity:
30 km WEST of Fort McMurray to Edmonton
Edmonton
Operated by TransCanada, the completed 500-kilometre pipeline will transport crude oil from the Fort McMurray area to Edmonton and diluent in the opposite direction, from Edmonton to operations near Fort McMurray. The
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O I LS A N D S R E V I E W. c O m
Operational:
mid
Bruderheim
Cost:
900,000 330,000 bbl/d of crude oil
bbl/d of diluent
Cost:
Operational:
$3 2017 BILLION
project also includes eight pump stations, four tank farms and two loading/ unloading terminals. Construction is slated to begin in mid- to late 2014. Regulatory approval applications were filed in early 2013.
Redwater is on the brink of the bitumen refining revolution. Located only 5 km north of Alberta’s Industrial Heartland and with direct access to Fort McMurray, Redwater offers a diverse commercial and industrial base with strong development and employment prospects. Enjoy the advantages of a rural atmosphere while also having easy access to urban amenities in our friendly, full service community.
Contact Us
Phone 780.942.3519 ecdev@redwater.ca www.redwater.ca
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Coming Soon to Sturgeon County Riverside Springs is spread over 415 acres of prime real estate located on the banks of the Sturgeon River. It will have fully serviced premium half-acre lots for sale, including river lots, which will be the site of Sturgeon County’s premier estate homes. Experience the tranquility and reserve your lot today!
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As new projects are planned for the Heartland, the need for environmentally friendly technologies is becoming more important
Shell's Scotford Upgrader (pictured here) will supply Quest with up to one million tonnes of CO2 per year, which will be stored permanently underground.
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PHOTO: DARRYL ZUBOT
By Jim Bentein
Green
$745
Williams Energy fractionation plant
Quest Project
million
for the Quest Project
$496
-5to00,000 nnes of CO2/year
-1,000,000 tonnes of CO2/year
million
for the Enhance Project
70%
The CCSF is aimed at reducing GHG emissions by 70% (200 megatonnes) through carbon capture and storage projects by:
2050 a
which is the same as removing 260,000 vehicles from the road
huge list of industrial projects could conjure an image similar to something out of a Charles Dickens novel. However, a closer look at the specific projects planned for Alberta’s Industrial Heartland region paints a different—much greener—picture. Without exception, the projects planned include environmentally friendly components, with a common theme of capturing and reusing huge volumes of CO2 and other greenhouse gases (GHGs). One of those projects is Provident Energy Ltd. and Williams Energy (Canada) Inc.’s fractionation plant, which processes off-gases. Williams Energy entered an agreement in 2012 to purchase off-gases from Canadian Natural Resources Limited’s Horizon oilsands plant. With Horizon operational, the plant will be reducing CO2 emissions in Alberta by 500,000 tonnes per year, according to David Chappell, president of Williams Energy. That’s equivalent to removing 85,000 vehicles a year from Alberta’s roadways. But Chappell points out that the Quest project, being developed in conjunction with Shell Canada Limited’s Scotford Upgrader, will remove even more—up to one million tonnes of CO2 per year, which is the equivalent of taking 175,000 vehicles off of the province’s roads. And even those numbers are eclipsed by the environmental benefits of the upcoming Sturgeon Refinery and the related Alberta Carbon Trunk Line. The Sturgeon Refinery will be the first refinery of its kind to use gasification technology—producing pure CO2 that will be captured and then sold to Enhance, who will transport the CO2 using its 240-kilometre-long, 16-inchdiameter Alberta Carbon Trunk Line to southern Alberta, where it will be used for enhanced oil recovery (EOR). The line will also carry CO2 from Agrium Inc.’s nearby Redwater fertilizer plant.
= 5,000 vehicles
The Heartland’s environmentally friendly projects are seeing support from the Alberta government—the Enhance project received about $496 million from the $2-billion Carbon Capture and Storage Fund (CCSF). The CCSF is a result of the government’s Climate Change Strategy, aimed at reducing GHG emissions by 200 megatonnes—or 70 per cent—by 2050 through carbon capture and storage projects. The Quest project received $745 million from the CCSF, and also saw $120 million in additional support from the federal government. Once construction is complete, Quest will capture an estimated 1.2 million tonnes of CO2 per year and store it in underground basins. Leah Lawrence, president of Calgary-based Clean Energy Capitalists Inc., a consulting firm working with Enhance and other companies looking at CO2 capture, believes there’s the potential to produce at least 1.4 billion barrels of oil in Alberta using CO2 for EOR. In addition, she thinks all of the GHG emissions in the province could potentially be stored permanently in the depleted reservoirs. “The potential is enormous,” echoes Enhance president and chief executive officer Susan Cole. Lawrence cites two studies proving the potential of CO2 in EOR: one by the Alberta Economic Development Authority (AEDA) and another by the provincially appointed Alberta Task Force on CCS. The task force’s study predicts 450 megatonnes of CO2 could be captured and sequestered annually in Alberta, beyond the 240 megatonnes emitted now in the province. Meanwhile, the AEDA report predicts the captured CO2 could produce at least 1.4 billion barrels of crude, worth more than $105 billion at today’s oil prices, while taxes and royalties paid to governments would be as high as $25 billion.
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lIMe PrOCeSSInG
Going old school Lime plant contributes to big development news for Alberta’s Heartland By Melanie Collison
t
Bruderheim’s 1,300 residents need recreational facilities and generally want a better quality of life, he says. “Lamont relies on taxes of farmland which are very low, so services and amenities are also low. Our non-residential tax base is five per cent of our budget. We have to get to 30 per cent to be sustainable.” After the heady days of planning “Upgrader Row” in Alberta’s Industrial Heartland sagged into one disappointing cancellation after another, it’s exciting for Lamont to be wooed again. And the Graymont plant is not the only big news for Lamont County. Canexus Corporation is applying to expand its hydrocarbon transloading terminal located just east of Bruderheim. Triton Fabrication Inc., in the town of Lamont, is expanding its modular fabrication shop and almost doubling its workforce, Newman says. MEG Energy Corp. has also announced plans to build its HI-Q pilot plant on the Canexus property in 2014, if all goes well with its regulatory hearings. MEG’s Stonefell tank terminal is already under construction west of Bruderheim. “Then there are pipelines and a transmission corridor coming through this area,” Newman says. “We’re trying to get our heads around growth in the next 18 months and the tax base we’re going to have and the impact of residential growth that could happen. It’s exciting times.”
PHOTO COMPOSITION: JEREMY SEEMAN
he newest addition to Alberta’s Industrial Heartland will be performing one of the oldest known chemical reactions: hydrating quicklime. Graymont Western Canada Inc. expects to break ground this spring on a lime processing and distribution centre seven kilometres east of Bruderheim, an industrial bedroom community located in central Alberta. Lime is the crucial ingredient in one of the two established processes for freeing raw and produced water of the calcium, magnesium, silica and other contaminants that cause scaling on the steam generating boilers that enable steam assisted gravity drainage (SAGD). Bruderheim and surrounding Lamont County are warmly welcoming Graymont’s lime hydration plant and distribution centre. “It’s a good fit for the location and for Lamont County,” says county manager of economic development Jim Newman. “It doesn’t have a big environmental impact or footprint.” But the plant does have jobs, a tax contribution and a commitment to community involvement, adds Bruderheim Mayor Karl Hauch. “Here we are in the middle of the Industrial Heartland, we’re the closest residents, but seemingly we’re the least able to capitalize on opportunities. We’re all for a project that’s responsible to the environment.”
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Advertisers’ Index Access Pipeline Inc.
................................................................................................
Alberta’s Industrial Heartland Association
.......
See the heart of the oilsands like you’ve never seen it before!
14
inside front cover
ATCO Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 City of Edmonton
....................................................................................................
Explore the Athabasca oilsands region using the new interactive Canadian Oilsands Navigator.
14
City of Fort Saskatchewan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . inside back cover Inca Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 NC Services Group Ltd.
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PCL Industrial Management Inc. Progress Land Services Ltd.
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14
outside back cover
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7
Skyway Canada Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Stewart Weir & Co Ltd.
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Strathcona County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Thunder Bay Port Authority
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9
Town of Redwater . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Visit the oilsands with the click of a button. canadianoilsandsnavigator.com
• Lease ownership • Operating and upcoming project locations • Operating project details • Project development timelines • Key performance indicators • Company-specific capital expenditures
canadianoilsandsnavigator.com
seizing
industrial opportunity
For business expansion or relocation information contact Economic Development at:
780.992.6231 or visit www.fortsask.ca
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