FORT SASKATCHEWAN, Alta. — Dow Chemical has announced plans to invest nearly $9 billion in a net-zero petrochemical project northeast of Edmonton.
Dow’s Path2Zero facility is being billed as the world’s first net-zero Scope 1 and 2 greenhouse gas emissions-integrated ethylene cracker and derivatives site.
"This is a first-of-its-kind-in-the-world net zero petrochemicals facility and it will be the very first announced major project in Canada that is getting off the ground thanks to support from our investment tax credit for carbon capture storage and utilization, as well as our investment tax credit for clean hydrogen," Deputy Prime Minister Chrystia Freeland told reporters Wednesday in Fort Saskatchewan.
The project aims to convert cracker off-gas into hydrogen as a clean fuel to be used in ethylene production. Carbon dioxide is to be captured on-site and then transported to be stored by adjacent partners.
The project is expected to increase the U.S. chemical company's polyethylene capacity by two million tonnes per year and decarbonize its global ethylene capacity by 20 per cent.
The province says it is providing a 12 per cent grant worth $1.8 billion to the project through the Alberta Petrochemicals Incentive Program.
Two federal tax credits are to provide up to $400 million in support of the project that will be delivered upfront "to get shovels in the ground" said Freeland.
"We're so proud that it's happening here. We're so proud you've chosen Alberta and Canada."
Freeland said the project will provide up to 8,000 jobs during construction and 500 full-time jobs when it's open.
"I love it when a plan comes together and this one has taken a while to come together but it's come together in a big way today," said Dow chair and CEO Jim Fitterling.
He said plastics like the ones Dow produces at the site have already been recognized for their environmental and social advantages.
"They already have a greenhouse gas footprint that is typically less than half of their alternative materials. Now we intend to take that to zero."
The news conference comes after Alberta Premier Danielle Smith recently invoked the province's sovereignty act to push back on the federal government’s proposed clean electricity regulations, but on Wednedsay she struck a more conciliatory tone with Ottawa.
"This project is one of the largest private sector investments in Alberta’s history. It reinforces the work we have done to ensure our province is the best place in the country to invest and do business," said Smith.
"I would say this is an example of how the federal, provincial and municipal governments can work together and I'm hopeful we can see a lot more of that. When we work together we can see amazing projects happen like this."
Construction is expected to begin next year, with the first phase starting in 2027 and the second in 2029.
This report by The Canadian Press was first published Nov. 29, 2023.
— By Bill Graveland in Calgary
The Canadian Press