CKPC selected Heartland Canada Partners, a 50-50 joint venture between Fluor Canada and Kiewit Construction Services, as the EPC contractor
Canada-based Pembina Pipeline and Kuwait-based Petrochemical Industries (PIC) announced that the Canada Kuwait Petrochemical (CKPC) has executed a lump sum engineering, procurement and construction (EPC) contract to the construct a propane dehydrogenation (PDH) facility.
The new PDH facility is planned to be constructed within an integrated PDH and polypropylene (PP) upgrading facility (PDH/PP Facility) in Canada.
In February, Pembina Pipeline and PIC announced plans to build a C$4.5bn ($3.41bn) integrated petrochemical facility in Alberta, Canada. The facility was planned to be developed through the companies’ equally-owned joint venture (JV) entity CKPC.
Pembina president and chief executive officer Mick Dilger said: “When faced with the proposition of trading returns for risk, Pembina has consistently chosen certainty and downside protection, particularly in new platforms or new businesses. Our relentless pursuit of a lump sum contract for the PDH facility reflects our disciplined and prudent approach to capital allocation.
“This project is highly strategic for Pembina and our producer customers in the Western Canadian Sedimentary Basin. It offers a new demand source for domestically produced propane and supports ongoing development of Canada’s world-class hydrocarbon resources.”
CKPC fixes 60% of the cost of the PDH/PP facility
With the contract, CKPC has fixed an approximately 60% of the cost of the PDH/PP facility. Pembina has also revised its share of capital cost and project timing, following the EPC contract.
The company has revised its proportionate share of the capital cost of the PDH/PP Facility, including a 100% directly-owned supporting facilities to $2.7bn, following the execution of the lump sum EPC contract and cost certainty for approximately 60% of the project cost.
CKPC intends to start commercial operations at the PDH/PP Facility in the second half of 2023.
It has selected Heartland Canada Partners, a 50-50 joint venture between Fluor Canada and Kiewit Construction Services, as the EPC contractor for the new PDH facility.