Jan. 22, 2019
by Morinville News Staff
The province announced Tuesday that Calgary-based Value Creation Inc. (VCI) and its wholly-owned subsidiary Value Chain Solutions Inc. are on track to invest $2 billion in an upgrading facility in the Alberta Industrial Heartland, just east of Edmonton. It is believed the project will create more than 2,000 construction jobs and another 200 full-time positions once the facility is up and running.
VCI’s project would be the first commercial-scale partial upgrader in the world using new technology VCI has been developing over several years.
The first phase of the Value Chain Solutions – Heartland Complex (VCS-H) will use 77,500 barrels-per-day (bpd) of diluted bitumen to produce a medium synthetic crude oil and an ultra low sulfur diesel. The project is expected to generate roughly $2.5 billion in revenue to the province over the 30-year life of the project and Strathcona County is expected to receive about $280 million in municipal tax revenue over the life of the project.
“We’re taking the bull by the horns and fighting to get full value for our oil,” said Premier Rachel Notley in a release Tuesday. “Albertans have been talking about this for decades, and we’re not content to sit on the sidelines and let good jobs and investment pass Alberta by for places like Louisiana. That has happened for too long, and it has got to stop. We’re making sure the next generation of Albertans have the opportunities they deserve in a stronger, more resilient, more diversified province.”
The VCI facility will upgrade diluted oil sands bitumen into a higher-value crude blend that can flow easier through pipelines. The partial upgrading technology is expected to reduce greenhouse gas (GHG) emissions by 16 per cent per barrel compared to current processes used to extract bitumen.
“We here at Value Creation Inc. and Value Chain Solutions Inc. look forward to building upon Premier Rachel Notley’s vision of diversifying our energy markets and maximizing the value of the resources owned by Albertans,” said Columba Yeung, chairman and CEO, Value Creation Inc. and Value Chain Solutions Inc. “Our project is going to create good, long-term jobs with game-changing technology for low-cost upgrading and strong environmental performance.”
The government has agreed to support the project through a $440-million loan guarantee, subject to reaching a final agreement.
Alberta is providing more than $3 billion in support for crude oil and bitumen partial upgrading and petrochemical upgrading.
Mark Plamondon, executive director of the Alberta’s Industrial Heartland Association said the government’s Made-in-Alberta upgrading program is important to making value-add investments happen in Alberta.
“Alberta’s Industrial Heartland is a key economic driver of the province’s economy, with potential for $30 billion in new investment by 2030,” he said. “Upgrading more of our resources here at home means more jobs and more investment in our local communities, with new value chains that will help diversify our economy for generations to come.”
The Strathcona County-based project is already underway. Some foundational infrastructure is in place and design work is nearly completed. The plant is expected to be operational in 2022.