Williams late Thursday said it is drawing up plans to build the first propane dehydrogenation (PDH) facility in Canada, which would give it room to increase its polymer-grade propylene production to serve a growing petrochemical market.
The Tulsa-based operator currently is the only company in Canada that produces polymer-grade propylene, which is used as a feedstock in plastics manufacturing. As designed, the proposed facility, with an annual capacity of about 1 billion pounds, would be built at Williams’ Redwater facility near Edmonton, AB. About $600-800 million in capital spending would fund the facility, primarily from cash on hand.
If it is constructed, the PDH facility would convert propane into propylene, which would be transported to to the U.S. Gulf Coast. The associated hydrogen byproduct is to be sold in the Alberta marketplace.
“Building a PDH facility would further build on the value and expertise that we’ve built in Canada and serve the booming North American petrochemical market,” said Williams Energy Canada President David Chappell. “Besides our expertise in extracting and marketing these products, we have the infrastructure in place with fractionation, distribution and storage to fully realize the value from a new PDH facility.”
When Canada’s oilsands is converted into usable oil, the off-gas product includes natural gas, natural gas liquids (NGL) and olefins, Williams noted. Williams pioneered a process to extract the liquids product at its Fort McMurray, AB, facility at a third-party oilsands plant where it now recovers about 14,000 b/d of a NGL/olefins mixture, which includes propane, propylene, butane, butylenes and condensate. Expansions under way would enable Williams to recover another 10,000 b/d of an ethane/ethylene mix.
With the company’s existing facilities in Edmonton, “we would be able to capture value from PDH production byproducts — butane/butylene and ethane/ethylene — that another PDH operator would have to burn,” Chappell said. “We’ve built a unique business in Canada, and we’re continuing to explore ways to capture more of the off-gas available from existing and planned upgraders, and to add more value to the products we produce.”
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