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New $1.5-B natural gas pipeline to provide feedstock to Dow's petrochemicals plant and other industrial facilities

Canadian utilities CU.TO said is developing a $1.5-B natural gas pipeline project in Alberta to transport natural gas to Dow's petrochemicals plant and other industrial facilities.

The company, majority-owned by ATCO ACOx.TO, said the Yellowhead Mainline project would include 200 kilometers (124 miles) of pipeline and related control and compression facilities that will run from Peers, Alberta, to Edmonton.

Development of the pipeline comes as demand for gas grows from Alberta's industrial expansion and population growth as well as from offshore buyers as Canada's first LNG export terminal comes online next year.

"Both of those stories are very important as we think about the growth of not only Alberta's economy but Canada's economy," ATCO Energy Systems Chief Operating Officer Wayne Stensby said in an interview.

Dow, which will be the pipeline's biggest user, is investing $6.5 B on an ethylene cracker and expanded polyethylene capacity at Fort Saskatchewan, Alberta, with some carbon emissions to be captured and sequestered.

The pipeline is subject to Alberta regulatory approval and a final investment decision by Canadian Utilities. Canadian Utilities is not seeking government support, Stensby said.

Construction would begin in 2026 with completion expected by late 2027.

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