April 16, 2013 (Edmonton, Alberta)—Adding value to Alberta’s energy resources could increase the province’s gross domestic product (GDP) by $6 billion a year, create 18,000 new jobs that pay $1.8 billion a year in salaries and increase provincial revenue by $600 million a year, an economic impact study concludes. The study was commissioned by Alberta’s Industrial Heartland Association and conducted by Ron Schlenker, an economist with the University of Calgary and the head of Schlenker Consulting Ltd. The study was released today during the launch of Alberta Plus in Edmonton.
“The report conservatively assesses the impact of a number of petrochemical and hydrocarbon processing projects already sanctioned or being considered in Alberta,” said Linda Osinchuk, Chair of Alberta’s Industrial Heartland Association and the Mayor of Strathcona Country. “Still, we found the impact would be significant and would provide economic stability even when oil and gas commodity production and prices vary.”
Osinchuk added: “Our province is at an economic crossroads facing challenges to access markets, and other external factors. We support the province’s recent efforts to open pipeline access to international markets. We also believe further energy diversification and additional development of the petrochemical and hydrocarbon processing industry offers critical and viable economic, environmental, and social solutions.”
Alberta Plus, a group of municipal government and industry leaders, is working to promote added value to the province’s energy resources. Its primary members are Alberta’s Industrial Heartland Association, Agrium, Enhance Energy, Nova Chemicals, North West Redwater Partnership and Williams Energy.
“By turning our raw materials into value-added products, we can be less reliant on gaining access to outside markets; yes, we still want and need to ship raw materials but we can also be creating products for local, regional and national markets,” said Ian MacGregor, Chairman, North West Upgrading.
“Williams is proud to support the Alberta Plus initiative and do our part to help strengthen Alberta’s role as a key energy and petrochemical hub,” said David Chappell, President, Williams Energy Canada. “Our experience has shown us the value of further processing Alberta’s energy
resources. This is why we are adding to our present $1.7 billion investment in Alberta by recently announcing our plans to build a $900 million propane dehydrogenation facility.”
Alberta is Canada’s leading producer of petrochemicals, producing about $13.5 billion of chemicals and chemical products every year. The Government of Alberta currently supports value-added development through initiatives such as the Bitumen Royalty In Kind (BRIK) program and the Incremental Ethane Extraction Program (IEEP). Over the coming months, Alberta Plus will attract additional partners, engage the public and work with government to encourage further hydrocarbon and value-added production.
For more information, contact:
Chris Ghazouly, Project Manager
Alberta Plus is a group of municipal government and industry leaders working to promote added value—“The Plus”—to the province’s energy resources. Its primary members are Alberta’s Industrial Heartland Association (City of Edmonton, City of Fort Saskatchewan, Lamont County, Strathcona County and Sturgeon Country), Agrium, Enhance Energy, Nova Chemicals, North West Redwater Partnership, and Williams Energy. For more background on each partner, please visit: www.albertaenergyplus.ca/partners.
The goal of Alberta Plus is to raise awareness of the benefits to Alberta of an expanded value-added sector and to increase dialogue on this important subject. Through this process, Alberta Plus hopes the public, industry and political leaders will gain a greater understanding of this matter and be better able to make decisions that provide the maximum benefit to Alberta and the rest of Canada.
The Plus adds to the overall quality of life in Alberta by strengthening our economy and:
- Diversifying our economy, providing greater stability against energy commodity price and production cycles
- Generating significant revenue for essential provincial services and programs
- Creating valued-added products (such as diesel fuel, consumer goods and fertilizer) for Albertans and Canadians, reducing our reliance on access to outside markets
- Providing a long-term and stable economic future for Albertan families and communities
Through its member AIHA, Alberta Plus commissioned the Economic Impacts of Adding Value To Alberta’s Hydrocarbon Resources Study, which was released today and available on the website for Alberta Plus which was also launched today: www.albertaenergyplus.ca.
Alberta’s Industrial Heartland is Canada’s largest hydrocarbon processing region with more than 40 industry-based companies in five municipalities. The companies produce fertilizers, energy, petrochemicals and other products for local, national and global markets.
For further information, contact:
Chris Ghazouly, Project Manager
Economic Impacts of Adding Value to Alberta’s Hydrocarbon Resources Study
Alberta’s Industrial Heartland Association (AIHA), a key member of Alberta Plus, commissioned University of Calgary economist Ron Schlenker of Schlenker Consulting Ltd. to analyze the economic impacts of current and potential petrochemical and hydrocarbon processing investments in Alberta. The report assesses the general magnitude of economic impact to the entire province.
The report’s analysis includes net impacts on gross domestic product (GDP) and revenue for the Government of Alberta generated through corporate taxes, job creation and employment. The analysis is based on information from industry partners, Statistics Canada and industry consultants.
The scope of analysis is limited to the economic impacts of facility operation and does not include the substantial impacts of project construction or increased demand for upstream domestic oil and gas and further royalties to the government. The report included the net economic impacts of recently sanctioned projects and additional potential projects that were identified in a report prepared for AIHA and conducted by IHS entitled Hydrocarbons Processing Opportunities Study. This previous study identified major opportunities for the development of methanol, urea, ethylene and propylene facilities. The net economic impacts in Alberta were applied to the following projects:
- Planned expansions of Williams’ oilsands offgas processing facilities
- Williams’ proposed Propane Dehydrogenation (PDH) Plant
- NOVA Chemicals’ proposed polyethylene expansion
- A 900 kt/year methanol plant in Alberta’s Industrial Heartland
- A 600 kt/year urea plant
- A 300 kt/year polypropylene plant
- North West Redwater Partnership’s (NWR) proposed 50,000 bpd bitumen refinery
- A 96,000 bpd gas-to-liquids plant
Overall, the report is a conservative analysis of the true economic impacts that would occur if Alberta successfully attracts new petrochemical and hydrocarbon processing facilities. The report was prepared throughout the winter of 2012/2013 and released April 16, 2013.
The report and backgrounder are posted on the Alberta Plus website: www.albertaenergyplus.ca
For further information, contact:
Neil Shelly, Executive Director
Alberta’s Industrial Heartland Association 780.998.7453