Pembina Pipeline Corp. subsidiary Pembina Infrastructure and Logistics LP has let a contract to Worley Ltd. for delivery of engineering, procurement, fabrication, and construction (EPFC) on the operator’s recently approved Heartland NGL extraction plant (HEP) in Strathcona County, Alta., in Alberta’s Industrial Heartland (AIH).

As part of the contract, Worley will provide EPFC services for the proposed plant, which will have a nameplate capacity to process up to 21.2 MMcfd of natural gas extracted from NGLs it receives from ATCO Ltd. subsidiary ATCO Energy Systems’ now-approved 146-mile Yellowhead transmission pipeline extending from the Peers area in west-central Alberta to the Fort Saskatchewan region, the service provider said in July 30 regulatory filing.

Worley’s confirmation of the EPFC contract award follows Pembina’s May approval of the HEP project, which represents a capital efficient, low-risk monetization of Pembina's liquids extraction rights on the Yellowhead pipeline, with future growth potential, the operator said in a May 26 release.

Upon sanctioning the HEP, Pembina said the project—which includes a new 750-MMcfd straddle plant to extract NGL under Pembina's extraction rights on the Yellowhead pipeline—is an upsized project evolving from its previously announced Yellowhead extraction plant project.

HEP now will include incremental capacity to accommodate future additional opportunities on a capital efficient basis, enhancing Pembina's AIH footprint, the operator said.

As part of the project, Pembina confirmed it entered a long-term agreement at HEP to supply Dow Chemical Co. with ethane beginning in late 2029, scaling to 22,500 b/d by end-2030.

Following extraction at HEP, the ethane-plus mix will be processed at a combination of Dow Chemical Canada ULC’s Fort Saskatchewan manufacturing plant and Pembina's Redwater fractionation complex in Edmonton.

Pembina said it will retain the HEP project’s associated propane-plus production, which will benefit from downstream fractionation and marketing of up to 9,500 b/d of propane-plus NGL.

Requiring an estimated investment of about $570 million (Can.; US $406 million), Pembina said it is targeting in-service date for the HEP in late 2029.

Dow ethane supply agreement

In connection with the new firm volume commitment at HEP, Pembina said it has also amended terms of its previously announced ethane supply agreement with Dow.

Under the amended long-term agreement, Pembina will supply Dow with 35,000 b/d of ethane upon startup of Dow's Path2Zero project, which is also scheduled to enter service in 2029.

Pembina said it will source the 35,000 b/d of ethane from its existing supply portfolio, leveraging its integrated value chain, including deep-cut gas processing plants, ethane-plus transportation franchise, and fractionation capabilities.

Including the new 22,500-b/d agreement at HEP and the amended 35,000-b/d supply agreement, Pembina will supply Dow with a total of 57,500 b/d of ethane, a 15% increase compared to the original agreement of 50,000 b/d, the operator said.