18 March 2013 16:21 [Source: ICIS news]
HOUSTON (ICIS)--Williams will proceed with plans to build and operate an on-purpose propylene plant in Alberta, Canada, the US-based midstream company said on Monday.
The propane dehydrogenation (PDH) plant will have a capacity to produce 1.1bn lb/year (500,000 tonnes/year) of polymer-grade propylene (PGP), the company said. In addition, the capacity could be doubled in the future.
Williams expects the plant to cost $900m (€693m), and operations should start in the second quarter of 2016, the company said. The plant will be close to Williams's Redwater fractionation plant near Edmonton, Alberta.
Redwater's fractionation operations are being expanded to produce about 5m bbl/year of propane and 280m lb/year of propylene from offgas derived from Alberta's oil sand production, the company said. The Redwater operations, in fact, will be the primary source of propane for the on-purpose propylene plant.
The resulting propylene will be sent to petrochemical plants along the US Gulf Coast, Williams said. The company expects the PGP will be among the lowest-cost PDH-sourced monomer in North America.
Meanwhile, the company is exploring the development of new propylene markets for its production n Alberta, the company said.
The plant will use Oleflex process technology, provided by Honeywell's UOP, Williams said.
"We're thrilled to be moving full-speed ahead on Canada's first and only PDH facility. The project fits strategically within Williams' operations in Alberta, leverages our expertise in propylene and adds further value to a byproduct of oil sands upgraders," according to a statement by David Chappell, president of Williams Energy Canada. "Once operational, this new propane dehydrogenation facility will expand market opportunities for Canada, feed the demands of North America's growing petrochemical industry and allow for the creation of a new value chain in Alberta."
Williams CEO Alan Armstrong said, "We expect the PDH facility to deliver a very attractive return on investment as well as provide a long-term natural hedge of the propane volumes we control in our Canadian offgas processing business. Our planned PDH facility will enable Williams to capture the full value between natural gas and polymer-grade propylene rather than just the value between natural gas and propane."
($1 = €0.77)
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