The Alberta government will spend up to $1 billion on a series of grants and loan guarantees to build two to five partial oil upgraders in the province.
The government hopes the money will attract up to $5 billion in additional private investment and create 4,000 new construction jobs.
Premier Rachel Notley made the announcement Monday, following new recommendations from Alberta’s Energy Diversification Advisory Committee.
The money is expected to start flowing from government coffers in 2019 and last for eight years, with the majority coming in the form of loan guarantees in the next two to three years.
“Primarily it would be sort of a four-to-one ratio between loan guarantees and grants, broadly speaking,” Notley said.
Not getting ‘full value’ for oil
The plan is to upgrade Alberta’s thick oilsands bitumen in the province before shipping it to those North American refineries which would otherwise reject Alberta bitumen, favouring lighter oil blends instead.
“We are blessed with a greater variety of natural resources than anywhere in the world, but right now we’re not getting full value for them,” Notley said Monday.
Unlike raw bitumen, the partially upgraded product does not require diluent to help it travel through pipelines.