Friday , May 7 2021

How $ 2.1B for Alberta Petroleum Products Will Maintain More Plastics Production at Local Level

Plastics manufacturers in Alberta expected a $ 2.1 billion investment for petrochemical industry modernization programs, Prime Minister Rachel Notley said this week.

Canadian petrochemical sector relies almost exclusively on natural gas and liquid fuels as feedstock, according to Greg Moffat, senior director of the Chemistry Association Chamber of Commerce.

The elements of natural gas end in everything from food packaging to vehicles, building materials to adhesive foams and even windscreen washer fluid. Uses are broad, but the industry is facing challenges, including moving the product to the market and preventing waste and pollution.

Moffatt, who is in Alberta, talks to him Calgary Eyeopener host David Gray on what this new financing for plastic would mean. Here's a short version of this interview, which is edited for clarity and length.

Q: How great is the potential for this in your mind about Alberta?

A: When you look at what's happening in the US, they've seen nearly $ 260 billion in new projects that are being considered or built in the petrochemical value chain of gas, and Canada just has not succeeded.

Currently, there is a project in Alberta, which is currently under construction from the initial program for the diversification of the petrochemical industry in the chain of propane.

The Inter Pipeline petrochemical plant in Alberta will produce plastics that will be transported to manufacturers in eastern Canada and around the world. These manufacturers will turn the plastic into a variety of finished products. (Kyle Bakks / CBC)

Another project from this initial round is close to finding a final investment decision, and as you heard from governments earlier this week, they received over 20 applications worth nearly $ 60 billion. Without doubt, we can see that there are four to six projects worth $ 20 billion in Alberta.

There is considerable demand for petrochemical products. The demand for chemicals exceeds GDP globally every year, so there is a huge demand.

Question: Will this newly discovered investment by Notty's government help $ 2 billion?

A: Absolutely. Here we have the raw material and the pricing is quite favorable. When companies are seeking investment decisions, they are compared to another branch internally in another jurisdiction.

And for us this would be the United States. The Gulf states and in the Midwest, Pennsylvania and what they are, investment aids are widely available, very transparent and predictable.

The new report shows that LNG projects in British Columbia will be beneficial to the petrochemical industry of Alberta. This file photo shows the Petrochemical complex of Inter Pipeline, which is built northeast of Edmonton. (Kyle Bakks / CBC)

We have to do more with the resources we have here in Alberta, and the Alberta government is doing the right thing by intervening and providing investment support in the right way to encourage investment in the value chain here in Alberta.

Q: We can continue how you used plastic resin for wind turbines, but most polyethylene is used for things like food bags and shampoo bottles and toys and things that create a PR problem for this province that already has a PR problem with some of your products. How do you handle this side of the problem?

A: Well, I do not know this is a PR problem.

Q: Okay, you're right, it's not about public relations. This is a real problem.

A: This is a real problem of our association or the perspective of our members, but [also the] industry in North America and around the world. Plastics and other waste in the environment are unacceptable. By landfilling plastic waste here in Canada, we lose a valuable resource and we have to stop doing it.

We set ambitious targets for 100% of plastic packaging to be either reusable, recyclable or recovered by 2040. Meanwhile, 100% of plastic packaging must be recycled or re-usable by 2030.

That is why we need to do better work as individuals in changing our attitudes towards the products we use and be a little more responsible in this.

Plastic production says the goal is to recycle or recover 100% of plastic packaging by 2030. (Chris Watts / Reuters)

From the point of view of the industry, we are absolutely working to make plastic packaging recyclable and recoverable.

From government point of view, we need to introduce supportive regulatory frameworks to allow these plastics to be recovered and chemically recycled.

So you put them back to their main building block to redirect them to other plastic applications, or, honestly, we need to recover plastics, the energy from these plastics. They should not go to landfills.

Question: Next to BK we have the construction of this massive new liquefied natural gas plant in Kittimat. How will it turn into the plastic industry? What's the chance of Alberta?

A: As long as we have a problem with access to the crude oil market in Western Canada, we really have a problem with access to the natural gas market as our largest US customer is now our biggest competitor. So natural gas is to find a home from West Canada.

With LNG we will see increased demand and we hope to see some more projects. But when moving more natural gas into the market, this will allow more liquid to be produced.

We need to do more with natural gas, methane and natural gas, ethane and propane liquids here in Western Canada before we move it to another market where someone else will add value to it if we do not,

With files from Calgary eyes.

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