Aux Sable Canada and Dow Chemical Canada Announce Oil Sands Off Gas Ethane Sale Agreement And Strategic Alliance

    CALGARY, Jan. 17 /CNW/ - Aux Sable Canada Ltd. ("Aux Sable") and Dow
Chemical Canada Inc. ("Dow") announce that they have entered into an agreement
relating to the long-term sale of an ethane/ethylene stream from Aux Sable's
Heartland Offgas Plant ("HOP").
    Aux Sable will be the first company in Canada to extract ethane and
ethylene from an upgrader off gas stream. Aux Sable will produce the ethane
feedstock at the Heartland Offgas Plant ("HOP"), which is currently under
construction. Feedstock for HOP will be provided by BA Energy's Heartland
Upgrader. HOP will be located on land recently acquired by Aux Sable directly
north of Dow's Fort Saskatchewan facilities.
    To be developed in phases, HOP will produce a mixture of ethane/ethylene,
a mixture of propane/propylene and heavier hydrocarbons, and a residue gas
stream composed primarily of methane. Up to 8,000 bbl/d of ethane/ethylene
will be produced at the facility and sold to Dow under this long-term
arrangement. This project demonstrates a commitment by both companies to
value-added upgrading in Alberta and is expected to be one of the first to be
submitted by Dow for consideration under the new Government of Alberta
Incremental Ethane Extraction Policy.
    The HOP facility will have no SO(2) emissions and limited NO(*) emissions.
In addition, treating and processing the off gas and using lean gas as fuel
will lead to a 12 to 16% reduction in upgrader CO(2) emissions over using
unprocessed off gas as fuel.
    Coinciding with the HOP sale agreement, Sable NGL Canada Ltd. ("Sable
Canada"), an affiliate of Aux Sable, and Dow announce that they have entered
into a strategic alliance for the development of processing facilities for
upgrader off gas in order to recover valuable hydrocarbon feedstocks. Dow and
Sable Canada will work jointly with Alberta upgraders and refiners to develop
off gas projects that will produce feedstock for Dow's petrochemical
facilities in Fort Saskatchewan. Under the arrangement, Sable Canada will
construct, own and operate the off gas processing facilities, while Dow will
be the exclusive buyer of the ethane/ethylene streams produced at the
    "A key element of our strategy is to be a leader in the processing of
upgrader and refinery off gas. We believe that this alliance with Dow
strengthens our ability to aggressively pursue this growth industry, and we
are excited about the relationship," said W. J. (Bill) McAdam, President and
CEO of Aux Sable Canada and Sable Canada.
    "Our alliance with Sable Canada allows us to secure a long-term supply of
petrochemical feedstock," said Jeff Johnston, President of Dow Chemical
Canada. "The oil sands represent a large, untapped feedstock source for Dow's
Alberta operations."

    Aux Sable Canada and its US affiliate, Aux Sable Liquid Products ("Aux
Sable", are owned by Enbridge, Fort Chicago Energy Partners
and Williams. Sable Canada is owned by Enbridge and Fort Chicago Energy
Partners. Aux Sable and its affiliate Sable Canada intend to leverage their
position as a significant player in the natural gas processing and natural gas
liquids businesses through fee-based infrastructure investments.

    Dow Chemical Canada Inc., an indirect wholly-owned subsidiary of The Dow
Chemical Company, employs approximately 1,200 people in Canada. Headquartered
in Calgary, Dow Canada and its affiliates have manufacturing locations in
Sarnia and Toronto, Ontario, Fort Saskatchewan and Prentiss, Alberta, and
Varennes, Quebec. For more information about Dow Canada, please visit our web
site at

For further information:

For further information: Dorothy Golosinski, Manager, Regulatory and
Public Affairs, Aux Sable Canada, (403) 508-5865, E-mail:; Jonathan Moser, Manager, Public Affairs and
Government Relations, Dow Chemical Canada Inc., (403) 267-3520, Email:

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