Sturgeon County’s new upgrader should have huge spinoffs for St. Albert and the Edmonton region, say local experts.
North West Upgrading Inc. and Canadian Natural Upgrading Ltd. announced Thursday that they plan to build a 50,000 barrel a day bitumen upgrader south of Redwater next spring.
This plant will employ about 3,000 people on site during construction, said North West chairperson Ian MacGregor, plus another 5,000 in the region.
“When you build one of these things, it lasts 100 years,” he said of the upgrader, and it’ll be creating jobs and paying taxes the whole time.
“It’s the start of major industrial development in the (Industrial) Heartland again.”
And St. Albert could see huge spinoff benefits from it, said Ivan Mayer, president of the Riel Business Park Association.
“One of the reasons our economic development has been spinning its wheels is price,” he said, adding that, at $19 per square foot, industrial land is too expensive in St. Albert compared to Edmonton.
A plant like this one needs supplies, Mayer said, and the closer those supplies are to the site, the better.
“We’re right by it,” he said, so that will raise demand for local land as suppliers move in, making our prices more competitive. “It might spur developers now to say maybe we should grab some of that land and create some activity.”
As for the few industrial parts manufacturers already in St. Albert, “They’re going to be swamped,” he said.
This project is the most significant investment the heartland has seen in a number of years, said Neil Shelly, executive director of the Alberta Industrial Heartland Association. It should create about 500 permanent jobs when operational, which he estimates will lead to about 1,000 spin-off jobs in the region.
“It’s a psychological victory as well,” he added, as for years people had argued that it wasn’t feasible to refine bitumen in Alberta. “(This) basically shows that yes, we can.”
The upgrader will produce high quality diesel fuel that should help Western Canada fend off future fuel shortages, Shelly said. It could also create work for module manufacturers such as Horton CBI.
“There’s a lot of skilled tradespersons in the Edmonton area that are looking for jobs closer to home,” he continued, and this upgrader could give them up to 10 years of work if all three phases are built.
The upgrader will keep the Edmonton region strong in terms of economic development, said Nolan Crouse, St. Albert mayor and chair of the Capital Region Board, and could draw similar projects in the future.
“This puts your name on the map,” he said.
But the thousands of workers it brings could put stress on local rental and permanent housing markets, Crouse added.
“We’re asking every community to look at what their options are.”
The thousands of workers headed to the construction site each day could also cause traffic snarls on local roads.
While North West plans to bus 70 per cent of its workers on-site to reduce traffic, there’s still the matter of the intersection of Highways 15, 37 and 825, Shelly said.
“Right now it’s a very congested intersection,” he said, one that regularly causes traffic backups that stretch all the way into Fort Saskatchewan.
With the upgrader and expansions by Williams Energy and Agrium on the horizon, he said that area is going to become very busy very soon. He hoped the province would upgrade this intersection within three years.
The effect on St. Albert’s housing market is less clear, said Guy Boston, executive director of economic development for the city.
“There’s going to be a lot of pressure on the rental market,” he said, citing a 2006 study, but it might lead to just 30 additional home sales in the long term.
“A lot can change in five years,” he said, and it’s tough to say how many of those 5,000 workers will stick around.”
The upgrader is set for completion in 2016.
