Western Canada Recovers with $107 Billion in 2017 Project Kickoffs

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Western Canadian region continues to recover from the devastating wildfires that racked Alberta in May, with labor productivity and the real gross domestic product for Canada-wide businesses improving in the third quarter. Gains were attributed to the mining, quarrying and oil and gas extraction sectors, according to Reuters, all of which have a strong presence in the Western Canadian region. Industrial Info is tracking $107.59 billion in active projects in the region set to begin construction in 2017, almost 90% of which are attributed to four such industries: Oil & Gas Production, Oil & Gas Pipelines, Metals & Minerals, and Power.

Click on the image at right for a graph detailing planned 2017 project kickoffs in the Western Canadian region, by industry.

The Western Canadian region includes the provinces of Alberta, British Columbia, Manitoba and Saskatchewan, and the Northwest, Nunavut and Yukon territories.

Not surprisingly, the Oil & Gas Production Industry leads all others with $67.39 billion in projects currently set to begin construction in 2017, almost all of which are located in Alberta and British Columbia. However, the largest, by far, is Royal Dutch Shell plc's (NYSE:RDS.A) (The Hague, Netherlands) $25 billion LNG Canada plant at Kitimat, British Columbia, which has seen its final investment decision consistently pushed back; British Columbia's CFTK-TV recently reported that a representative from Shell recently told residents that the project "could begin by the year 2020, and the project would require between four and five years to be built," indicating that the most optimistic startup date is unlikely. The project is designed to produce as much as 12 million metric tonnes per year of liquefied natural gas (LNG). For more information, see Industrial Info's project report.

A more likely kickoff could be found in Woodfibre Natural Gas Limited's (Squamish, British Columbia) $1 billion LNG liquefaction plant in Squamish, which received necessary permits last month from the province. The company plans to convert a pulp mill into a facility to process 220 million standard cubic feet per day of natural gas into 2.1 million tons per year of LNG, for export to Asian countries. The company still needs to conclude agreements with the Squamish Nation, on whose traditional territory the plant is located, according to British Columbia's Coast Reporter. For more information, see Industrial Info's project report.

The Oil & Gas Pipelines Industry is in a distant second place with $13.25 billion in planned construction starts for 2017, more than one-third of which is associated with projects connected to Kinder Morgan Incorporated's (NYSE:KMI) (Houston, Texas) Trans Mountain pipeline project, which was approved, along with Enbridge's Prime Line 3 replacement project, by Prime Minister Justin Trudeau's administration late last month. For more information, see November 30, 2016, article - Canadian Prime Minister Rejects Northern Gateway Pipeline, OKs Trans Mountain.

Major elements of the Trans Mountain pipeline include the $3.5 billion portion from Hargreaves to Burnaby, Alberta, which runs 690 kilometers in two spreads, and the $1.14 billion portion from Edmonton to Hinton, Alberta, which runs 290 kilometers. Both portions are among those expected to up the full system's capacity from 300,000 to 890,000 BBL/d. For more information, see Industrial Info's project reports on the Hargreaves-to-Burnaby and Edmonton-to-Hinton pipeline segments. Industrial Info is tracking more than $500 million in other projects related to Trans Mountain.

The Metals & Minerals Industry could see a turnaround in 2017, following years of low commodity prices and the resulting delays in proposed and planned projects, with $9.76 billion in kickoffs slated for next year. One project that has faced such pushbacks is Yancoal Canada Resources Company Limited's (Saskatoon, Saskatchewan) $3 billion construction of a potash mine and processing plant in Southey, Saskatchewan. The project, which previously had been set to kick off in 2016, is expected to produce 2.8 million tons per year of potash over a 65-year mine life. Still, project kickoff dates in the Metals & Minerals Industry face plenty of uncertainty, as recent price gains do not necessarily signal a return to life for large-scale projects. For more information, see Industrial Info's project report.

The Power Generation Industry is looking at $5.79 billion in kickoffs, two of which are proposed hydropower projects that are mired in the permitting phases: SaskPower's (Regina, Saskatchewan) $630 million Tazi Twe Hydro Station in Stony Rapids, Saskatchewan, and Regional Power Incorporated's (Toronto, Ontario) $500 million Ryan River Hydro Power Station near Pemberton, British Columbia. The Tazi Twe station would generate 50 megawatts (MW) from two turbine generators, possibly Alstom's fixed-blade Kaplan model, while the Ryan River station would generate 145 MW from five Pelton turbine generator sets and a penstock tunnel. For more details, including contractor contact information and further specifications, see Industrial Info's project reports on the Tazi Twe and Ryan River proposals.

Of the $107.59 billion in total investment value (TIV) for projects expected to kick off in the Western Canadian region in 2017, nearly $100 billion worth are in the planning stages, where plenty of factors still could increase, decrease or totally eliminate the expected spending. More than $6.5 billion are attached to projects currently in the engineering stages, while roughly $1 billion worth are maintenance-related projects.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.