Canada's Wolf Midstream FIDs NGL North Phase II Project

Supplies of natural gas liquids, especially propane, have become increasingly tight in recent months, with prices reaching multi-year highs in the U.S. and Canada. Despite the strong price signals, increasing production is typically a lengthy, complex, and expensive process involving producers drilling new wells to yield more liquids-rich natural gas and crude oil. There is also another way to increase supplies: by extracting them from already processed and pipelined natural gas via a straddle plant that more intensively recovers additional NGLs, such as propane, from the existing gas supply. Canada’s Wolf Midstream has recently sanctioned such a plant, as well as a related pipeline and extraction plant in Alberta that it hopes to bring into service in 2023. In today’s blog, we examine this new straddle plant and Western Canada’s current propane supply situation.

Alberta’s petrochemical industry received bad news in late April when Dow, one of the world’s largest petrochemical companies, announced that it was delaying construction on an immense expansion of its ethane cracker in Fort Saskatchewan, AB, only a little more than a year after sanctioning the project. Although the length of the delay remains uncertain, the slowdown has created unwanted ripples across other projects that were tied to the expansion, especially for companies working to provide a substantial increase in ethane and natural gas supplies that will be required by the project. In today’s RBN blog, we take a closer look at the delay and what it might mean for Alberta’s energy industry. 

Several oil-sands expansion projects committed to when crude oil prices were double what they are today are finally coming online, and midstream companies active in Alberta are building new crude/diluent pipelines and storage capacity to keep pace. New storage caverns for natural gas liquids are also in the works, giving a much-needed boost to Canada’s Energy Province. Today we conclude our series on midstream infrastructure under development in or near Western Canada’s oil sands region that move and store hydrocarbon liquids.