Update on Heartland Petrochemical Complex
Posted Apr 22, 2021 8:52 am.
CALGARY – (660NEWS) — Inter Pipeline has provided an update on production capacity contracting and adjusted EBITDA guidance and environmental advantages related to its Heartland Petrochemical Complex (HPC).
HPC, which is in the final stages of completion in Strathcona County, will be an industry-leading petrochemical facility converting locally sourced, low-cost propane, into high-value polypropylene.
Polypropylene is an easily transported and fully recyclable plastic used in the manufacturing of an extensive range of essential finished products and lightweight automotive components.
The construction of HPC continues to advance, with the propane dehydrogenation plant expected to be complete in May 2021 and the polypropylene facility by the end of the year. Polypropylene production is expected to commence in early 2022.
Inter Pipeline’s objective is to secure a minimum of 70 per cent of HPC’s polypropylene production capacity under long-term, take-or-pay agreements; a commercial framework that will make HPC unique in the world for an integrated polypropylene facility.
These agreements are structured to include a stable return on capital payment to Inter Pipeline plus fixed and variable operating fees, with no exposure to commodity price fluctuations.
Inter Pipeline’s contracting efforts to date have yielded significant results. Currently, approximately 60 per cent of HPC’s production capacity is held under executed take-or-pay agreements with seven counterparties, including Canadian and multinational energy producers and North American polypropylene consumers. The weighted-average contract term of the seven agreements is approximately nine years.
Christian Bayle, Inter Pipeline’s President and Chief Executive Officer said, “Our commercial teams have made great progress in securing high-quality, long-term contracts for HPC’s production capacity and our systematic approach to contracting this unique facility over the past several years has been key to creating a diverse customer base.”
