Inter Pipeline Ltd. is warning that the cost of building its Heartland Petrochemical Complex has risen by about half a billion dollars and its in-service date may be delayed due to factors including the impact of the COVID-19 pandemic.
When announced in December 2017, the cost of the plant northeast of Edmonton designed to convert plentiful Alberta propane into polypropylene plastic pellets for export to manufacturers was estimated at $3.5 billion.
The Calgary-based company says the project now is expected to cost about $4 billion following a detailed analysis of work that remains after $2.5 billion spent to date.
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Inter adds measures at the construction site to deal with the pandemic could push startup to early 2022 from the initial schedule to open in late 2021.
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In March, Calgary-based Pembina Pipeline Corp. reported it would defer construction of its proposed nearby similar petrochemical project because of market conditions. It had increased the estimated cost by $400 million to $4.9 billion in January.
Inter says it is continuing its quest announced late last year to enlist a partner to share costs of the project. Pembina’s project is a 50-50 joint venture with Petrochemical Industries Company of Kuwait.
Pembina was awarded $300 million and Inter Pipeline Ltd. got $200 million in royalty credits in 2016 as an Alberta government incentive for the projects.
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