The Government of Saskatchewan has introduced a new program designed to enhance competitiveness by enabling increased value-added processing and infrastructure capacity.
Calgary-based Gibson Energy is the first successful applicant for the the Oil and Gas Processing Investment Incentive (OGPII), Saskatchewan announced last week.
Under the OGPII, operators can access a 15 per cent transferrable royalty credit for a greenfield or brownfield project.
In order to be eligible, a project must be a refinery, an upgrading facility, a gas commercialization project or other value-added facilities including helium processing, petrochemicals and carbon capture, storage, and utilization for enhanced oil recovery.
Projects must result in a significant increase in processing capacity, and have a minimum of $10 million in eligible costs.
The OGPII has a royalty credit cap of $75 million per project and a total program credit cap of $300 million in royalty credits.
Gibson operates a heavy crude oil processing facility in Moose Jaw that produces a variety of refined products including distillate and asphalt.
The company recently completed an expansion at the facility increasing throughput capacity by approximately 30 per cent — from 17,000 barrels per day to 22,000 barrels per day — with no increase in GHG emissions, ultimately reducing the facility’s emissions per barrel of oil processed by approximately 20-25 per cent.