Pembina Pipeline Corp., Calgary, and Petrochemical Industries Co. KSC (PIC) of Kuwait have formed Canada Kuwait Petrochemical Corp. (CKPC) and will proceed with front-end engineering design for a proposed 1.2 billion-lb/year integrated propylene and polypropylene (PP) production facility in Sturgeon County, Alta.
FEED activities are expected to be completed by late 2018, followed by a final investment decision from each partner. Deliverables of FEED include a refined capital cost estimate, a project execution plan, regulatory applications, an updated construction schedule, and projected in-service date.
The proposed PP facility is expected to consume 22,000 b/d of Alberta-produced propane, which is expected to be sourced from Pembina’s Redwater fractionation complex as well as other regional facilities. Subject to required approvals and FID, the combine expects to construct the PP facility nearby Pembina’s Redwater complex. The preliminary capital cost estimate of the project is $3.8-4.2 billion (gross).
“The encouraging results of the recently completed feasibility study, the previously announced award of $300 million in royalty credits from the Alberta government’s petrochemicals diversification program, and a joint venture with our world class partner, PIC, gives Pembina the confidence to further advance the project,” said Stuart Taylor, Pembina’s senior vice-president, NGL and natural gas facilities. “This project represents a material extension of our natural gas liquids value chain strategy and creates a significant incremental local market for western Canadian hydrocarbons.”
