Alberta has released a new vision and strategy for its natural gas industry, “Natural Gas Vision and Strategy”, that the province believes will position it as a post-pandemic powerhouse. At this stage, it is more vision than strategy, foreseeing Alberta as a key player in a global US$2.5-trillion hydrogen market in 2050, for instance, and establishing Alberta as the Western North America centre of excellence for plastics recycling by 2030.
With the exception of the previously announced Alberta Petrochemicals Incentive Program, which may cost the Alberta Treasury $1 billion in tax incentives, and support for carbon capture, utilization and storage from the province’s Technology Innovation and Emissions Reduction (TIER) fund, there’s no public money behind it. The principal mechanisms will be cutting red tape and creating a favourable policy environment, Premier Jason Kenney told a news conference on October 6, 2020. “A lot of this is government just getting out of the way,” he said.
Kenney positioned the Natural Gas Vision and Strategy as an environmentally-friendly measure — not merely because natural gas may serve as a transitional fuel from coal to emissions-free sources of energy — but because of the role it can play in hydrogen production.
Here, said Kenney, Alberta is doubly advantaged. It holds the world’s fourth largest reserves of natural gas and its early investment in carbon capture, utilization and storage will allow it to produce clean, or “blue”, hydrogen, which will be eagerly sought by future markets, he said. In the production of blue hydrogen, carbon emissions are captured and permanently stored.
The Natural Gas Vision and Strategy also bets heavily on petrochemicals, specifically plastics, and the announcement came a day ahead of the federal plastics strategy. Alberta’s plan is to become a global top 10 producer of petrochemicals and diversify the portfolio of products manufactured in the province while simultaneously becoming a centre of excellence in plastics recycling.
“Plastics themselves are not a problem. Waste is the problem,” said Dale Nally, Associate Minister of Natural Gas and Electricity, though neither he nor Kenney offered insight into what was meant by centre of excellence in plastics recycling beyond enhanced recycling practices.
“At this point we’re not putting an incentive program in for plastics,” said Nally, adding that he would take his cue from industry. “Not everything has to be incentivized.”
Other elements of the Natural Gas Vision and Strategy include securing greater access to world markets through two to three additional large-scale liquefied natural gas (LNG) projects by 2030 and continuing to meet growing demand for natural gas among Alberta’s industrial users, including the province’s biggest customer, the oil sands.