Williams announced today that it is exploring building a propane dehydrogenation (PDH) facility in Alberta, Canada. A new PDH facility, which would be the first in Canada, would allow Williams to significantly increase its production of polymer-grade propylene from its Canadian operations. Williams' proposed PDH facility in Canada would have an annual capacity of approximately 1 billion pounds. The company estimates capital expenditures of approximately US$600-800 mln that would be funded primarily with international cash on hand. Williams is the only company in Canada producing polymer-grade propylene, a valuable petrochemical feedstock used in plastics manufacturing. Williams would primarily use the propane it recovers at its Redwater facility near Edmonton, Alberta, as feedstock for the new PDH facility, which would convert the propane into higher-value propylene that will be transported to the U.S. Gulf Coast. The associated hydrogen by-product would be sold locally in the Alberta market.
"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 David Chappell, president of Williams Energy Canada. "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. "Because of our existing facilities, 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."