Provincial Press Release October 6, 2020 @ 1:16PM published at 1:27 PM.
A new plan for diversifying and growing Alberta’s natural gas industry will position the province as a post-pandemic powerhouse for responsible energy development.
The Natural Gas Vision and Strategy is a key part of Alberta’s Recovery Plan and shares the actions Alberta’s government will take to grow the sector and seize emerging opportunities for clean hydrogen, petrochemical manufacturing, liquefied natural gas (LNG) and plastics recycling.
“This plan outlines exciting new opportunities for Alberta job creators and workers. We will meet growing global demands for clean and sustainable energy by building on Alberta’s success in natural gas. Alberta is ready to lead in safe, clean and reliable energy today and into the future. This is a key part of Alberta’s Recovery Plan, designed to build, to diversify, and to create tens of thousands of jobs.” Jason Kenney, Premier
In addition to fuelling countries around the world, natural gas – expected to pass coal as the world’s second largest energy source by 2040 – has many other uses, including being the foundation for creating hydrogen. Alberta is already a leader in hydrogen production and has strong carbon capture and storage infrastructure in place. Combined with a number of projects being built across the province, Alberta has the potential to be a strong global competitor through the creation of a hydrogen economy.
“Alberta’s 300-year supply of affordable natural gas provides significant opportunity to attract investment and job creators back to the province, building back our economy stronger than ever. Our strategy builds on Alberta’s strengths and taps into new and exciting areas of our natural gas sector. Through this plan we will support a healthier future for Albertans and people around the world.” Dale Nally, Associate Minister of Natural Gas and Electricity
The vision and strategy were created following input from natural gas industry partners, Indigenous and municipal leaders, and expert advice from the 2018 Roadmap to Recovery report.
“Alberta’s natural resource industry is the greatest economic engine of this country, although the national prosperity it creates is often discounted. Nonetheless, the Government of Alberta and our industries continue to strive for excellence; advancing low-emissions technology and environmental efficiencies. The extraction of hydrogen from natural gas is yet one more example of our collective commitment to being the world leader in emissions reductions.” Nancy Southern, chair and CEO, ATCO Ltd.
“The Natural Gas Vision and Strategy announced today is a great step in advancing clean tech solutions and shows that energy development and environmental stewardship are both essential and can have local, national and international benefits. The world will need all forms of clean energy sources to meet global demand and natural gas will be an important part of that energy mix, while also being an essential feedstock for petrochemicals, hydrogen, and beyond. Steps like this are critical for Alberta and Canada to remain a global leader in producing clean hydrocarbons from source to end use. We look forward to working together on the actions outlined in the strategy.” Ginny Flood, chair, Clean Resource Innovation Network
“Alberta has it all: natural resources, skilled people and infrastructure. Putting them together in new ways will diversify the economy and drive our future prosperity. The government’s Natural Gas Vision and Strategy marks a turning point toward cleaner energy, new industrial offerings and a more circular economy.” Peter Tertzakian, deputy director, ARC Energy Research Institute
“Having a clear vision, taking a bold approach and building on our strengths is what made Alberta a major hub for petrochemicals in North America. NOVA Chemicals is an important part of that success story and our major investments in world-class petrochemical facilities, and innovation in recycling technology continue to build on that tradition. We are pleased to see the Alberta government create the environment for a plastic circular economy and allow our industry to do what it does best: deliver products and innovation the world needs.” Luis Sierra, president and CEO, NOVA Chemicals
“The government’s Natural Gas Vision and Strategy will add more value to Alberta’s resources by creating the environment where industry can compete to develop the low-carbon products that modern global economies are demanding. This is good news for every Albertan and reflects the critical importance of diversification in order to create a resilient economy. As an essential partner in Alberta’s energy future, Alberta’s Industrial Heartland is well-positioned to serve as a focal point for the growth areas presented in the Natural Gas Vision and Strategy, and our association is encouraged by the new investment attraction opportunities it represents.” Mark Plamondon, executive director, Alberta’s Industrial Heartland Association
Alberta’s Recovery Plan is a bold, ambitious long-term strategy to build, diversify, and create tens of thousands of jobs. By building schools, roads and other core infrastructure we are benefiting our communities. By diversifying our economy and attracting investment with Canada’s most competitive tax environment, we are putting Alberta on a path for a generation of growth. Alberta came together to save lives by flattening the curve and now we must do the same to save livelihoods, grow and thrive.
Natural Gas Vision and Strategy
The actions listed in the strategy will support the government’s vision to revive Alberta’s natural gas sector and become the No. 1 supplier of clean, secure, responsibly sourced natural gas in Canada and internationally. It highlights five areas with huge growth potential in Alberta:
Goal: Exports of hydrogen and hydrogen products across Canada, North America and globally are in place by 2040.
The Hydrogen Council, a global advisory council of corporate executives, estimates that by 2050, the global hydrogen sector could generate US$2.5 trillion per year and create 30 million jobs.
Hydrogen as a fuel source produces only water with no carbon emissions, and has the potential to become a major part of meeting carbon reduction targets worldwide.
Alberta has the potential to be one of the lowest cost hydrogen producers on the planet.
Hydrogen production will support continued and growing employment of highly skilled energy workers, create jobs and support innovation across the province.
Goal: Alberta becomes a global top 10 producer of petrochemicals and diversifies the portfolio of products manufactured.
According to Alberta’s Industrial Heartland Association, there is an opportunity to grow Alberta’s petrochemical sector by more than $30 billion by 2030, resulting in more than 90,000 direct and indirect jobs and more than $10 billion in revenue for the Government of Alberta from corporate and personal income taxes.
Alberta has one of the most established petrochemical manufacturing centres in Canada with room for growth in Alberta’s Industrial Heartland, Grande Prairie, Joffre and Medicine Hat.
The Alberta Petrochemical Incentive Program, which will open to applications this fall, is already drawing investment attention into the province’s petrochemical sector.
Alberta’s robust carbon capture and storage infrastructure will also allow petrochemical producers to create valuable products while simultaneously lessening their environmental impacts.
Liquefied natural gas (LNG)
Goal: Alberta natural gas has access to Asian and European markets through two to three additional large-scale LNG projects by 2030.
According to the International Energy Agency, global demand for natural gas is projected to increase by 36 per cent over 2018 levels by 2040.
The LNG Canada project currently under construction will provide enough energy to displace 20 to 40 coal-fired power plants in Asia, reducing global GHG emissions by 60 million to 90 million tonnes of carbon dioxide each year.
Canada is among the world’s top five natural gas producers, and more than two-thirds of Canada’s production comes from Alberta.
Growing access to global markets will help create jobs and generate billions of dollars in revenues to support programs and services across our province and Canada.
Plastics circular economy
Goal: Alberta is established as the Western North America centre of excellence for plastics recycling by 2030.
A “circular economy” is a concept gaining acceptance within the plastics and recycling industries, in which plastic waste is reused in new products through enhanced recycling techniques and technologies.
About 95 per cent of plastic packaging – valued at C$100 billion to C$150 billion – is disposed of after a single use, meaning there is a significant opportunity for plastics producers to recapture that value.
A study by Deloitte and Cheminfo Services Inc. suggested that major changes to recycling in Canada could see 90 per cent of plastics avoid landfills by 2030.
Alberta is well-positioned to implement a circular economy for plastics thanks to our petrochemical manufacturing industry, lower transportation costs and the development of enhanced recycling technologies within the province.
The government has already initiated work on developing a plastics economy in the province by being a member of the Plastics Alliance of Alberta.
Goal: Alberta demand for natural gas and natural gas liquids grows with increased investment in natural gas processing infrastructure. Adding more natural gas transportation infrastructure happens faster, encouraging industry performance and growth.
Alberta’s oil sands are a large consumer of natural gas. Natural gas production also supplies condensate/diluent to the oil sands and is a primary input for natural gas in-situ projects, which represented 50 per cent of bitumen production in 2019.
As oil sands production increases, so will its natural gas consumption to support oil sands processing activities.
A number of power-generation facilities in the province are also looking to convert to natural gas as a fuel source, increasing demand for natural gas as industrial electricity demand also climbs.