Oilsands Review - Redefining the Heartland May 2013

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The boom is backAlberta’s Heartland is ramping

up for another busy season

of projects15Painting the Heartland greenAs new projects are planned for the Heartland,

the need for environmentally friendly

technologies is becoming more important20

: : 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 : :

Shiftingfocus

The Heartland has

diversifi ed its

post-recession focus,

but upgrading isn’t

completely off the

books just yet

www.industrialheartland.cominquiries@industrialheartland.com780.998.7453

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 agoAlberta 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 municipalitiesMunicipal 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 futureThe 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.

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.

The power of municipal collaboration has been a unique part of Alberta’s

vibrant innovation, and community commitment demonstrate the municipal

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

Municipal cooperation enhances business attraction, improves planning,

the region evolve into Canada’s largest hydrocarbon processing centre with

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

building on the key strengths of our Alberta Advantage. And they have also

CELEBRATING 15 YEARS ALBERTA’S INDUSTRIAL HEARTLAND ASSOCIATION

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Shifting focus� e Heartland has diversifi ed its post-

recession focus, but upgrading isn’t

completely o� the books just yet

By Jim Bentein

10

Alberta’s Industrial HeartlandIf you’re building an industrial project, the Heartland is

the place to be

6 What is Alberta’s Industrial Heartland?

8 Heartland by the numbers

By Rianne Stewart

4

The boom is backAlberta’s Heartland is ramping

up for another busy season

of projects15

Painting the Heartland greenAs new projects are planned for the Heartland, the need

for environmentally friendly technologies is becoming

more important

By Jim Bentein

20Going old schoolLime plant contributes to big

development news for

Alberta’s Heartland

By Melanie Collison

22

Contents

O I LSAN D S R EVI EW | R E D E f I N I N g th E h EARtLAN D | mAY 2013 3

C O n t e n t S

EDITORIAL

EDITOR

Rianne Stewart | [email protected]

CONTRIBUTING WRITERS

Jim Bentein, Melanie Collison

CONTRIBUTING PHOTOGRAPHER

Darryl Zubot

EDITORIAL ASSISTANCE MANAGER

Marisa Sawchuk | [email protected]

EDITORIAL ASSISTANCE

Laura Blackwood, Sarah Eisner

CREATIVE

PRINT, PREPRESS & PRODUCTION MANAGER

Michael Gaffney | [email protected]

CREATIVE SERVICES MANAGER

Tamara Polloway-Webb | [email protected]

CREATIVE LEAD

Cathlene Ozubko

GRAPHIC DESIGNER

Jeremy Seeman

CREATIVE SERVICES

Jenna O’Flaherty

SALES

SALES MANAGER—ADVERTISING

Monte Sumner | [email protected]

SENIOR ACCOUNT EXECUTIVES

Nick Drinkwater, Diana Signorile

SALES

Brian Friesen, Sammy Isawode, Mike Ivanik,Nicole Kiefuik, David Ng, Tony Poblete, Sheri Starko

For advertising inquiries please contact

[email protected]

AD TRAFFIC COORDINATOR—MAGAZINES

Denise MacKay | [email protected]

DIRECTORS

CEO

Bill Whitelaw | [email protected]

PRESIDENT

Rob Pentney | [email protected]

DIRECTOR OF SALES & MARKETING

Maurya Sokolon | [email protected]

DIRECTOR OF EVENTS & CONFERENCES

Ian MacGillivray | [email protected]

DIRECTOR OF THE DAILY OIL BULLETIN

Stephen Marsters | [email protected]

DIRECTOR OF DIGITAL STRATEGIES

Gord Lindenberg | [email protected]

DIRECTOR OF CONTENT

Chaz Osburn | [email protected]

DIRECTOR OF PRODUCTION

Audrey Sprinkle | [email protected]

DIRECTOR OF FINANCE

Ken Zacharias, CMA | [email protected]

OFFICESCALGARY 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

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If undeliverable, return to: Circulation Department, 80 Valleybrook Dr,

North York, ON M3B 2S9. Made in Canada.

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.

4 O I LSAN D S R EVI EW.c O m

a 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 bitumen-

rich 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.

Th e 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 gov-ernment 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.

Th e association ensures responsible and effi cient develop-ment for its members, while also promoting economic activity in the area through such initiatives as its Alberta Plus marketing campaign. Th e campaign focuses on four areas: economics, environment, careers and job security.

“Th e goal of our board really was to bring the Alberta heart-land 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 refi ning 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. Th ere is already movement in the areas of carbon capture and storage and off -gas processing, for instance.

Th e Heartland is also experiencing an infl ux of green tech-nologies 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 environ-mental 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 com-munities, 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.

Th e Scotford refi nery, 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.

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H e a rt l a n d 1 0 1

City ofEdmonton

3Strathcona

County

3Strathcona

County

4SturgeonCounty

2LamontCounty

1City of Fort

Saskatchewan

7Town of

Bruderheim

8Town of

Redwater

6Town ofGibbons

5

1City of Fort Saskatchewan

Population: 20,000

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

2 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

3 Strathcona County

Population: 92,400


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

Municipal members:

The area governed by Alberta’s Industrial Heartland Association is outlined in black.

What is Alberta’s Industrial

Heartland?



4 Sturgeon County

Population: 19,000


Companies active in the area: Agrium Inc.

Landmarks: Country Soul Stroll agricultural driving tour, Cardiff Park

AIH representative: Mayor Don Rigney

5 City of Edmonton

Population: 1,300,000

Size: 9,426.7 square kilometres

Companies active in the area: TBD

Landmarks: Art Gallery of Alberta, Royal Alberta Museum, West Edmonton Mall, Fort Edmonton Park

AIH representative: Mayor Stephen Mandel

7 Town of Bruderheim

Population: 1,300


Landmarks: Spring Creek Wetland Interpretive Centre, Bruderheim Heritage Trail, Walker School Museum, Canadian Moravian Museum

6 Town of Gibbons

Population: 3,030


Landmarks: Jurassic Forest, Goose Hummock Golf Course

8 Town of Redwater

Population: 2,116


Landmarks: Pembina Place, Redwater Museum

Associate members:

www.progressland.comPh: 1-866-454-4717

Proud to be part of the development of Alberta’s Industrial Heartland



We know what it takesto succeed

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Industrial activity in theHeartland region employs over

rely on industry in theHeartland region for their

livelihood

7,000 people6,100+ people

�e Heartland area covers

are in the City of Edmonton

Taxes paid by industry toHeartland municipalities exceeded

$77 MILLION in 2012Annual local spending by industryin the Heartland area for goodsand services is greater than

$900 MILLION

has been invested in the region to date

over $30 billion

over 40Industrial activity in the

Heartland began in 1952

HEARTLAND by the NUMB3R$

industrial companies are active in the Heartland region

SOURCES: ALBERTA’S INDUSTRIAL HEARTLAND ASSOCIATION; NORTHEAST CAPITAL INDUSTRIAL ASSOCIATION



ATCO Power Developing and operating high efficiency industrial scale power generation projects to supply reliable, low cost electricity to Alberta’s primary industries.

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ATCO Energy Solutions Providing natural gas liquids extraction, industrial water infrastructure, electric transmission and substations, and energy storage & logistics solutions.

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ATCO IS ...Energizing Alberta’s Industrial HeartlandENERGY | UTILITIES | STRUCTURES & LOGISTICS | TECHNOLOGIES

www.strathcona.ca

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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.

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Th e 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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By Jim Bentein

Th e Heartland has diversifi ed its post-recession focus, but upgrading isn’t completely off the books just yet

Six 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, execu-tive 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 Refi nery—came back into the barn, followed by specula-tion early this year of another—the BA Energy Inc. Upgrader—following its lead.

Renewed hopeIn early November, the North West Redwater Partnership (NWR) announced that its Sturgeon Refi nery, 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.

Th e 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.

Th e long-planned oilsands bitumen upgrader will be the fi rst project of its type to capture large volumes of CO

2, which will be

put to use by the province’s fi rst CO2 pipeline,

the Alberta Carbon Trunk Line (ACTL), ac-cording to MacGregor.

“We will be capturing enormous quanti-ties of CO

2,” 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. Th at’s equal to the emissions from all the cars in Alberta. Th is 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, whichMacGregor says will employ 8,000 construc-tion workers at its peak, was scheduled to be-gin this spring. It will take three years to build the huge project, which is being constructed


S H I F t I n G F O C U S

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in three 50,000-barrel-per-day phases for total capacity of 150,000 barrels per day.

MacGregor says it’s important to under-stand that the company isn’t just developing an upgrader to turn bitumen into a lighter, refi nery-ready crude, as all other planned and existing upgraders in the province do.

“Most refi neries 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 fi rst phase], and diesel is a high-margin product that is in great demand in western Canada.”

Another key technological part of the refi nery’s design is that it will deploy gasifi ca-tion, 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 CO

2. It will also

produce 10,000 barrels per day of lubricants, which could spawn the development of a lubricants plant.

Opportunities galoreUnlike most CO

2 produced by conventional

upgraders, which is mixed with nitrogen and other elements, the CO

2 produced by

the Sturgeon Refi nery 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.

Th e CO2 will be sold to Enhance Energy

Inc., which is currently developing the 240-kilometre, 16-inch-diameter ACTL. Th e line will eventually transport CO

2 from the Agrium

fertilizer plant near Redwater and from the Sturgeon Refi nery to be used for EOR in de-pleted 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 fi t the schedule of the Sturgeon Refi nery. It will be designed to ultimately move 40,000 tonnes per day of CO

2.

Shelly predicts the Sturgeon Refi nery will bring numerous economic benefi ts to the Heartland area and the rest of Alberta, includ-ing about 800 permanent direct jobs—600 of those in the Heartland and 200 in Calgary. Enhance president and chief executive offi cer Susan Cole echoes this, estimating 97,000 person-years of employment during the refi nery’s construction phase and 307,000 person-years of employment during the fi rst 30 years of operation.

And because large industrial plants tend to have a “multiplier eff ect,” 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 provin-cial and federal tax revenue. North West re-cently calculated that if the Sturgeon Refi nery 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 benefi t directly from the project’s profi ts. Th e 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.

Talk of the townTh e 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 offi cer Columba Yeung.

Th e $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 econom-ically 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 recap-italized after BP Canada Energy injected



$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 HeartlandThe 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 en-vironmental impact of the Heartland area’s refining and petrochemical industries, the area is seeing focus on CO

2 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

natural gas production. The off-gases and captured CO

2 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 refinery-upgrader, with that CO

2 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 CO

2 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 CO

2 capture and oilsands off-gas infrastructure.

and refineries in the region, and they all pro-duce CO

2 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 CO

2 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 CO

2 from the Scotford refinery-

upgrader to an off-gas processing facility operated by Aux Sable. The firm breaks off-gas down into ethane and other value-added products, as well as hydrogen, which is returned to Shell for use in its refinery. The Aux Sable plant employed a peak construc-tion 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 develop-ment, could lead to a “value chain” of new

The Sturgeon Refinery Owners: north West Upgrading Inc., Canadian natural resources limited

Capacity: 150,000 barrels per day in three phases

Will receive some of its feedstock volumes from the Government of alberta’s Bitumen royalty in-Kind program

First 50,000-barrel-per-day phase sanctioned in fall 2012, start-up expected in 2016

“ 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



A premier eco-industrial development opportunityin Alberta’s Industrial Heartland

ENERGY AND TECHNOLOGY PARK Edmonton

Edmonton - Primed for more industrial growth www.edmonton.ca/eetp

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

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

From refi neries 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 under-construction projects seeing action in the Heartland area.

STURGEON REFINERYDeveloped by: North West Redwater Partnership (subsidiary of North West Upgrading Inc. and Canadian Natural Upgrading Limited, a subsidiary of Canadian Natural Resources Limited)

Th e Sturgeon Refi nery will produce 40,000 barrels per day of diesel, and will be the fi rst of its kind to capture large volumes of CO2

. Th e CO2—up to

11,000 tonnes per day—will be transported by the Alberta Carbon Trunk

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.

Capacity:

Th ree phases of 50,000barrels per day of crude oil

(150,000 barrels per day total)

Cost:

$5.7BILLION

(fi rst phase)

Operational:

50,000 bbl/d

X3Bruderheim

Lamont

Ft.Saskatchewan

2016Location:

Sturgeon County

UPGRADERS AND REFINERIES

Alberta’s Heartland is ramping up for another busy season of projects


H e a rt l a n d P rO J e C t U P dat e

GAS-TO-LIQUIDS PROCESSING PLANTDeveloped by: Sasol Limited

If this project goes ahead, Sasol will build the fi rst gas-to-liquids facility in Canada. Initial plans predict producing 48,000 barrels per day of diesel, naphtha and liquefi ed petroleum gas from the fi rst phase. Th e company estimates that

the facility will produce 500 new permanent jobs and employ over 5,000 at its peak construction. Th e company has determined a project site but has delayed project plans for at least one year to focus on its operations in Louisiana.

Capacity: Cost:

$4+BILLION

Operational:

500 MILLION cubic feet per day

Bruderheim

Lamont

Ft.Saskatchewan

TBDLocation:

STRATHCONA County

OFF-GAS PROCESSING

KEYERA DE-ETHANIZERDeveloped by: Keyera Corp.

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

fractionation plant. Th e company estimates a peak construction workforce of 200 employees, with a permanent workforce of 60. Engineering for the project is currently underway.

Capacity: Cost:

$110MILLION

Operational:

Bruderheim

Lamont

Ft.Saskatchewan

2014Location:

Fort saskatchewan, alta.30,000 bbl/d

of ethane-rich natural gas liquids

mid

OFF-GAS PROCESSING

BA ENERGY UPGRADERDeveloped by: Value Creation Inc.

Construction was suspended in 2008 due to fi nancial constraints, but the company recently announced that it was actively seeking investment and

would resume construction once secured. Th e BA Energy upgrader will produce synthetic crude oil and synthetic diluent.

Capacity: Cost:

$1+BILLION

Operational:

260,000 bbl/d

Bruderheim

Lamont

Ft.Saskatchewan

TBDLocation:

STRATHCONA County

UPGRADERS AND REFINERIES



Bruderheim

Redwater

Lamont

WILLIAMS DEHYDROGENATION FACILITYDeveloped by: Williams Energy (Canada) Inc.

Th e 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. Th e plant’s

by-products will include hydrogen, butane/butylenes and condensate. Th e project was sanctioned in March 2013 and is currently undergoing the consultation process.

Capacity: Cost:

$900MILLION

Operational:

2016

Location:

strathcona county

1.3 BILLIONbarrels of propylene

2nd quarter of

OFF-GAS PROCESSING

QUESTDeveloped by: Shell Canada Limited, Chevron Corporation, Marathon Petroleum Corporation

As a fully integrated carbon capture and storage project, Quest will capture CO

2 from Shell’s Scotford upgrader-refi nery 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.

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. Th e project began construction in September 2012 and is expected to have a peak construction workforce of 700.

Capacity: Cost:

$1.35BILLION

Operational:

Bruderheim

Lamont

Ft.Saskatchewan

2015Location:

Strathcona County1 MILLION

cubic feet per year of CO2

CO2 CAPTURE AND STORAGE PROJECTS

ALBERTA CARBON TRUNK LINEDeveloped by: Enhance Energy Inc.

Th is 240-kilometre pipeline will transport CO2 captured at Agrium Inc.’s Redwater

fertilizer plant and the under-construction Sturgeon Refi nery to aging reservoirs in southern Alberta for use in enhanced oil recovery and for permanent storage. Project plans are dependent on the timing of the Sturgeon Refi nery.

Capacity: Cost:

$1BILLION

Operational:

14.6 MILLION tonnes of CO

2 per year

TBD

CO2 CAPTURE AND STORAGE PROJECTS

Edmonton

Bruderheim

Lacombe

Clive

To�eld

Camrose

Leduc

Redwater

Location:

redwaterto clive, alta.



Bruderheim

Lamont

Ft.Saskatchewan

HI-Q FIELD DEMONSTRATION PROJECTDeveloped by: MEG Energy Corp.

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

bitumen into heavy crude oil. Th e process emits 44 per cent fewer emissions than conventional upgrading processes. Regulatory approval applications have been fi led and are expected to come through in mid-2013.

Capacity: Cost: Operational:

Location:

lamont county

OTHER PROJECTS

$103.6MILLION3,000 bbl/d

of diluted bitumen

2014mid

Edmonton

AthabascaPump stations

Ft.McMurray

GRAND RAPIDS PIPELINEDeveloped by: TransCanada Corporation and Phoenix Energy Holdings Limited

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. Th e

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 fi led in early 2013.

Capacity: Cost: Operational:Location:

30 km WEST of Fort

McMurray to Edmonton

OTHER PROJECTS

$3BILLION

900,000bbl/d of crude oil

330,000bbl/d of diluent

2017

GRAYMONT LIME HYDRATING FACILITYDeveloped by: Graymont Western Canada Inc.

Th e 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 fi led. Once received, construction is expected to begin in mid-2013.

Capacity: Cost:

TBDTBDOperational:

Location:

lamont county

OTHER PROJECTS

Bruderheim

Lamont

Ft.Saskatchewan

Location:

lamont county

2014late



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@TownofRedwater

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As new projects are planned for the Heartland, the need for environmentally friendly technologies

is becoming more important

By Jim Bentein

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.


a huge list of industrial projects could conjure an image similar to something out of a Charles Dickens novel. However, a closer look at the specifi c projects planned for Alberta’s Industrial Heartland

region paints a diff erent—much greener—picture.Without exception, the projects planned include environmentally friendly

components, with a common theme of capturing and reusing huge volumes of CO

2 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 oper-ational, the plant will be reducing CO

2 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 fromAlberta’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 CO

2 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 benefi ts of

the upcoming Sturgeon Refi nery and the related Alberta Carbon Trunk Line. Th e Sturgeon Refi nery will be the fi rst refi nery of its kind to use gasifi cation technology—producing pure CO

2 that will be captured and then sold to

Enhance, who will transport the CO2 using its 240-kilometre-long, 16-inch-

diameter Alberta Carbon Trunk Line to southern Alberta, where it will be used for enhanced oil recovery (EOR). Th e line will also carry CO

2 from

Agrium Inc.’s nearby Redwater fertilizer plant.

Th e 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). Th e 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.

Th e Quest project received $745 million from the CCSF, and also saw$120 million in additional support from the federal government. Once con-struction is complete, Quest will capture an estimated 1.2 million tonnes of CO

2 per year and store it in underground basins.Leah Lawrence, president of Calgary-based Clean Energy Capitalists Inc., a

consulting fi rm 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 CO

2 for EOR. In addition, she thinks all of the GHG emis-

sions in the province could potentially be stored permanently in the depleted reservoirs.

“Th e potential is enormous,” echoes Enhance president and chief execu-tive offi cer 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. Th e task force’s study predicts 450 megatonnes of CO

2 could be captured and sequestered annually

in Alberta, beyond the 240 megatonnes emitted now in the province.Meanwhile, the AEDA report predicts the captured CO

2 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.

-500,000tonnes ofCO2/year

-1,000,000tonnes ofCO2/year

QuestProject

= 5,000 vehicles

$745million

for theQuest Project

$496for the

Enhance Project

million

70%

�e CCSF is aimed at reducing GHG

emissions by 70% (200 megatonnes)

through carbon capture and storage

projects by:

2050

Williams Energyfractionation plant

which is the same as removing 260,000

vehicles from the road


G r e e n

the 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 com-munity 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 fi t for the location and for Lamont County,” says county manager of economic de v elop-ment 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.”

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 fi ve 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 disappoint-ing 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.

“Th en there are pipelines and a transmission corridor com-ing 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.”

By Melanie Collison

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Going old schoolLime plant contributes to big development news

for Alberta’s Heartland


l I M e P rO C e S S I n G

seizing industrial opportunity

For business expansion or relocation information contact Economic Development at: 780.992.6231 or visit www.fortsask.ca

See the heart of the oilsands like you’ve never seen it before!

Visit the oilsands with the click of a button.

canadianoilsandsnavigator.com

Explore the Athabasca oilsands region using the new interactive Canadian Oilsands Navigator.

• Lease ownership • Operating and

upcoming project locations

• Operating project details

• Project development timelines

• Key performance indicators

• Company-specific capital expenditures

canadianoilsandsnavigator.com

Access Pipeline Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Alberta’s Industrial Heartland Association . . . . . . . inside front cover

ATCO Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

City of Edmonton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

City of Fort Saskatchewan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . inside back cover

Inca Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

NC Services Group Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

PCL Industrial Management Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . outside back cover

Progress Land Services Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Skyway Canada Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Stewart Weir & Co Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Strathcona County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Th under Bay Port Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Town of Redwater . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

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Oilsands Review - Redefining the Heartland May 2013

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