Where Investment Thrives

Petrochemicals

Industry Profile

Petrochemicals

Alberta is Canada's leading petrochemical manufacturing province, home to four major ethylene plants producing 8.6 billion pounds annually.

Alberta has one of the largest refining and petrochemical industries in Canada, characterized by modern, world-scale plants, efficient transportation systems, and access to the third largest crude oil reserve in the world and significant natural gas reserves. Alberta has four ethane-cracking plants, including two of the world’s largest, with a combined annual capacity to produce approximately nine billion pounds of ethylene.

There is enormous potential for investors who are interested in tapping into Alberta’s vast energy resources to produce refined petroleum products and petrochemicals.

 

Areas of Expertise

  • The petrochemical industry in Canada is dominated by the processing of ethane into ethylene and its downstream derivatives. These derivatives are precursors to a wide range of useful consumer and industrial products like polyethylene and ethylene glycol.
  • Methane, used in the production of ammonia, is a key ingredient for fertilizer, an important product for the agricultural industry, another major industry in Alberta.
  • Building on Alberta’s large supply of propane, the Petrochemicals Diversification Program (PDP) awarded $500 million in royalty credits to two projects in Alberta to encourage investment in petrochemicals. Both projects will convert propane to propylene and further onto polypropylene. The propane value chain is in its infancy in Alberta, but will generate new opportunities for further investment and new products to be produced in the province.
  • Alberta has an emerging biochemicals sector that is using biomass as an alternative feedstock to petrochemicals in the production of energy products and industrial chemicals.

Opportunities

Alberta’s Natural Gas Feedstock Advantage

  • Alberta has huge reserves of natural gas and is one of the top natural gas producers in the world.
  • Alberta’s three major shale gas formations make up nearly 60 billion barrels of natural gas liquids, and these reserves have upwards of 15% gas liquid content.
  • Natural gas prices are projected to remain low with modest growth over the next 15 years.

Cost Competitive Environment

  • Value added investment benefits from an advantage to Henry Hub natural gas price, resulting in one of the lowest feedstock prices in North America.
  • Alberta has an available, highly skilled labour force, experienced from years of significant oil and gas capital projects.
  • Government supports investment in the province by maintaining a low tax environment with no provincial sales tax.

Eco-Industrial Integration

  • Alberta is creating a world-class, integrated hydrocarbon processing hub in Alberta’s Industrial Heartland along with smaller/emerging clusters near Red Deer and Medicine Hat. Eco-industrial integration can generate substantial cost savings, new business opportunities, and reduce the overall industrial environmental footprint.
  • Synergies exist in an integrated ecosystem allowing for waste streams to be used as feedstock for plants within the complex and for the sharing of services and site-specific infrastructure. This leads to greater environmental benefits, such as lower total emission levels and less water demand.
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EXPORTS -4.0% y/y
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Related Content


Related Content

Program

Petrochemicals Diversification Program - https://www.alberta.ca/petrochemicals-diversification-program.aspx
PDP will provide up to $500 million in royalty credits to encourage companies to build manufacturing facilities that will turn ethane, methane and propane into more valuable products.

Program

Petrochemicals Feedstock Infrastructure Program - https://www.alberta.ca/petrochemicals-feedstock-infrastructure-program.aspx
This program will provide up to $500 million in grants and loan guarantees for building facilities to supply natural gas liquids feedstock.

Program

Partial Upgrading Program - https://www.alberta.ca/partial-upgrading-program.aspx
PUP will provide up to $1 billion in grants and loan guarantees to encourage companies to build bitumen upgrading facilities.

Program

Capital Investment Tax Credit (CITC) - https://www.alberta.ca/capital-investment-tax-credit.aspx
CITC is a tax credit to encourage manufacturing, processing and tourism infrastructure companies to make capital investment in Alberta.

Publication

Petrochemical and Midstream Regulatory Roadmaps - /publications/downstream-and-midstream-regulatory-roadmaps/
The Regulatory Roadmaps are a planning tool to support companies in the project development stage for petrochemical and midstream facilities in Alberta.

Publication

Oil and Gas Quarterly - Summer 2018 - http://www.albertacanada.com/business/statistics/oil-and-gas-quarterly.aspx
Discover the latest information on the projects and related activities occurring in the oil and gas industry including government initiatives, industry updates, new technologies, and statistical data.

Publication

Oil Sands Quarterly - Summer 2018 - http://www.albertacanada.com/business/statistics/oil-sands-quarterly.aspx
Discover the latest information on the projects and related activities occurring in the oil sands industry, including government initiatives, industry updates, project listings, new technologies, and statistical data.

Organization

Alberta Energy - http://www.energy.alberta.ca/
Alberta Energy, a ministry of the Government of Alberta, is responsible for ensuring the development of Alberta's resources to the benefit of all Albertans.

Organization

Alberta Energy Regulator - https://www.aer.ca/
AER is a regulatory body with a mandate to provide for the efficient, safe, orderly, and environmentally responsible development of Alberta’s energy resources.

Organization

Chemistry Industry Association of Canada - http://canadianchemistry.ca/about/what-we-do/
CIAC provides coordination and leadership on key issues impacting Canada's chemistry sector.

Organization

Canadian Plastics Industry Association - https://www.plastics.ca/home
CPIA is a dynamic, member driven, not-for-profit association dedicated to the growth of plastics businesses and helping the industry reach its full potential.

Contacts

Tiago Lage, Downstream and Petrochemical
E-mail: tiago.lage@gov.ab.ca    
Phone: 780-427-6502

Thomas Kearns, Downstream and Petrochemical
E-mail: thomas.kearns@gov.ab.ca  
Phone: 780-427-0458