Alberta’s Energy Diversification Act Will Facilitate Investment in the Chemistry Sector
March 09, 2018
The Chemistry Industry Association of Canada (CIAC) welcomed Bill 1, The Energy Diversification Act, tabled in the Alberta legislature today. The Act would launch a second round of the Petrochemical Diversification Program (PDP) and establish a Feedstock Infrastructure Initiative to help deliver the natural gas components necessary for more private investment in the province’s value-add sectors such as chemistry.
The first iteration of the PDP, announced in 2016, utilized $500 million in natural gas royalty credits to attract investment into the chemistry sector. Even though the government announced that only two projects would receive the allocated credits, 16 potential investment plans totalling over $20 billion were submitted to the government of Alberta for review, demonstrating how much potential growth exists in the chemistry sector. The additional focus in Bill 1 on feedstock infrastructure will help catalyze investor sentiment in Alberta as a world class investment destination.
“CIAC is delighted to see the government move so quickly towards the implementation of its diversified energy future,” said Bob Masterson, President and CEO of CIAC. “The renewal and expansion of the PDP to provide support for the Feedstock Infrastructure Initiative will create more opportunities for the chemistry sector in Alberta,” he continued. “By adding value to Canada’s low-carbon energy resources, the chemistry sector is helping Alberta and Canada take a leadership position in meeting the global climate challenge.”
The chemistry sector is already a key contributor to Alberta’s energy value-add strategy. Natural gas liquids, in particular ethane, and natural gas itself (methane) are converted into high value chemicals and fertilizers resulting in $16 billion in sales in 2016, with over $8 billion in exports. Additionally, the industry creates well-paid high value jobs (over 1/3 of its employees have university degrees) with important multiplier effects within local economies – each chemical job results in another five in related sectors and services.