Canada to be home to the world’s first net-zero carbon emissions ethylene plant

Rahmat Kassam, Senior Investor Services Advisor & Emily Kneteman, Regional Director, Alberta, Invest in Canada

ethylene cracker facility in Fort Saskatchewan, Alberta

Canada will be the home of the world’s first net-zero carbon emissions ethylene plant. U.S.-based Dow has announced plans for a major brownfield investment at its existing site in Fort Saskatchewan, Alberta, north of Edmonton. The project could represent the largest capital investment in Alberta in 15 years.

Dow announced its plans for the first ever net-zero carbon emissions ethylene and derivatives complex on October 6, 2021. Known in the industry as a cracker, the complex is part of industrial processes that turn feedstocks such as propane or ethane into polyethylene, which is used in products ranging from recyclable plastic food containers and bottles to plastic toys.

How will this project achieve net-zero carbon emissions?

Dow President and CFO Howard Ungerleider explained in an interview with Yahoo Finance that decarbonizing the Fort Saskatchewan facility involves an existing and a new world-scale cracker, an auto-thermal reformer to turn waste gas from the crackers into hydrogen, and carbon capture and sequestration (CCS) by joining the Alberta trunk line.

Ungerleider told Yahoo Finance that the first stage of the upgrade would be ready to operate in 2027 and the second phase in 2029.

Net-zero for emissions, net gains in growth and employment

In addition to the introduction of brand-new technology, the entire Dow site in Fort Saskatchewan is being retrofitted to net-zero carbon dioxide emissions. The project will more than triple capacity at the site, bringing with it increases in production and community employment.

The project is located in Alberta’s Industrial Heartland region, one of the world’s most attractive industrial clusters for chemical, petrochemical, oil, and gas investment.

With this announcement, Dow joins a growing list of global companies that are choosing Alberta’s Industrial Heartland as a world-leading destination for their industrial decarbonization efforts.

Mark Plamondon, Executive Director, Alberta’s Industrial Heartland Association

The Fort Saskatchewan plant is located in the Edmonton Region Hydrogen HUB, which launched in April 2021 to build on its leadership in Canada’s energy transition through the production, use and export of low-carbon hydrogen.

While Dow’s investment decision is good for Fort Saskatchewan, for Alberta, and for Canada, it’s also good for the rest of the world, as industries transition to a net-zero carbon emissions future.

Investing in Canada sees even lower capital outlays—plus other advantages

The Fort Saskatchewan project further builds on Dow’s success in reducing carbon emissions intensity. The capital outlay of the project is expected to be even better than recently commissioned crackers—delivering about 15% lower capital intensity than a new Texas project.

In addition to lower costs, Dow cites three additional factors for selecting the Fort Saskatchewan site for this first-ever technological achievement: carbon capture infrastructure, competitive feedstocks, and attractive government partnerships.

Invest in Canada supports global investment

One of Dow’s partnerships is with Invest in Canada, which has worked closely with Dow since January 2019. Invest in Canada is pleased to support Dow’s expansion activities, and looks forward to continuing to do so in the years to come. Dow has been established in Canada for over 75 years.

Canada’s support for this type of investment can serve as a model for how government investment can encourage the development and accelerate adoption of emissions-avoiding technologies and solutions.

Jim Fitterling, Chairman and CEO, Dow Inc.

In a Bloomberg article following the investment announcement, Mr. Fitterling urged the U.S. to follow Canada’s lead on carbon pricing.

If you are interested in expanding your company to Canada, please contact Invest in Canada.