Williams, the worlds only processor of oil sands upgrader offgas, has approved the construction of a propane dehydrogenation (PDH) facility in Alberta, Canada.
The new PDH facility, the first and only one in Canada, will allow Williams to significantly increase production of polymer-grade propylene (PGP) from its Canadian operations. Williams is the only company in Canada currently producing polymer-grade propylene.
The PDH facility will have the capability to initially produce up to 1.1 billion pounds (500 kilotonnes) per year of polymer-grade propylene, with the opportunity to double capacity with a future expansion.
The company estimates capital expenditures of up to $900 million to be funded with expected cash flow from its Canadian operation and international cash on hand. Pending appropriate permitting approvals, the PDH facility is scheduled to go into service in the second quarter of 2016.
Williams has selected Honeywells UOP as the vendor to provide the UOP Oleflex process technology for the dehydrogenation process. The technology uses a platinum-based catalyst system, as well as less energy and water than competing PDH technologies.
Williams' PDH facility will be sited in close proximity to its existing Redwater fractionation plant near Edmonton, Alberta.
Williams plans to primarily use propane recovered from its expanding oil sands offgas processing operations, along with local propane purchases, as feedstock for the new PDH facility.
The company will convert the propane into higher-value propylene that will be transported to the US Gulf Coast and sold to petrochemical producers. The associated hydrogen byproduct will be sold in the Alberta market. Williams is also exploring the development of new propylene markets for its production in Alberta.
The Redwater complex includes fractionation, storage and distribution facilities and is currently being expanded to produce approximately 5 million barrels of propane and 280 million pounds of PGP annually from offgas, in addition to other NGLs and olefins. The addition of the new PDH facility will significantly increase Williams production of polymer-grade propylene. The company expects the new facility to produce one of the lowest-cost, PDH-sourced propylene feedstocks in North America.