Moose Jaw firm benefits from new government program

A Moose Jaw-based oil refinery is the first business in Saskatchewan to receive financial support from a new government program.

Gibson Energy Inc., was introduced Thursday as the first successful applicant for the Oil and Gas Processing Investment Incentive (OGPII).

According to a media release, the program is “designed to enhance Saskatchewan’s competitiveness in oil and gas development by enabling increased value-added processing and infrastructure capacity.”

Oil and gas producers in the province can access the program to generate increased value from their work in Saskatchewan. The program also is designed to help companies with their greenhouse gas (GHG) emissions management projects.

Gibson said it’s going to do that by recycling and reusing the heat it uses in refining cycles.

The company will use the money to increase its daily barrels-per-day output from 17,000 to 22,000. But part of the expansion includes a heat reuse component.

“We’ll do a better job of recovering the waste heat of the products coming out of the refinery, putting that in as pre-heat to the products coming in (to the refinery), so net is you don’t need any new heat,” said Michael Lindsay, Gibson’s senior vice-president of operations and engineering.

“You don’t need heaters (and) you don’t need gas or burners to bring that heat in.”

The company will get about $3 million over the next few years from the province as part of the incentive.

Premier Scott Moe acknowledged that the provincial government is using projected resource revenues in the future to pay for the incentive.

But he said it’s a good, worthwhile investment, because it supports jobs and local energy production.

Moe said the Gibson expansion meant new work for about 40 employees and subcontractors.

Gibson Energy operates a heavy crude oil processing facility in Moose Jaw that produces a variety of refined products.

“The incentive provides successful applicants with a 15 per cent transferrable royalty credit, applied to eligible costs directly related to an eligible greenfield or brownfield project,” the media release said.

OGPII requires projects to result in a large increase in processing capacity and to have a minimum of $10 million in eligible costs. The program has a royalty credit cap of $75 million per project and a total credit cap of $300 million in royalty credits.