Low labor costs and cheap feedstock have renewed interest in Alberta’s Industrial Heartland
FOR YEARS, THE NOTION OF RAPIDLY expanding Alberta’s Industrial Heartland sat on the backburner. A combination of high oil prices, high costs for labor and soaring demand for natural gas liquids in Asian markets created unfavorable conditions for the construction of so-called “value-add” facilities on domestic turf. As an example, Imperial Oil’s refinery in the Strathcona region (pictured), which produces a wide range of products, was built over 40 years ago. But with prices for feedstock expected to remain low for the foreseeable future, there is a heightened incentive to create more finished products north of Edmonton.
That allure was bolstered in February when the Alberta government announced a $500million incentives program for the construction of petrochemical plants, which would presumably be located in the Industrial Heartland.
It remains to be seen whether the program will lure in would-be plant operators – not to mention whether it will prove counterintuitive to the government’s intentions behind its carbon tax if these plants aren’t low carbon.
Power plants are part of the Industrial Heartland’s build out. ATCO Power aims to build the 90 MW Strathcona Cogeneration heat and power plant for a propane dehydrogenation facility. The power plant will be gas-fired.
ATCO Power also proposes to build a 400 MW gas-fired power plant in nearby Strathcona County. Alberta currently gets most of its power from coal and natural gas. ATCO Power says that, with the power demand forecast to increase by more than 50 percent by 2022, Alberta will need to build 7,000 MW of installed power capacity over the next 10 years. Alberta currently uses a peak of 10,600 MW to power homes, businesses and institutions across the province.