Dow pauses work on $11.6B Alberta net-zero petrochemical site due to economic uncertainty
Dow Chemical has paused construction on its $11.6-billion net-zero petrochemical project northeast of Edmonton due to the uncertain economic state of the world.
The company said Thursday it is delaying construction of its Path2Zero project in the Industrial Heartland to match market conditions, which Dow said should save the company about $1 billion.
The Dow project involves an expansion and retrofit of Dow's existing manufacturing site along the North Saskatchewan River north of Fort Saskatchewan.
The project was to include the building of a new hydrogen-fuelled ethylene cracker, as well as carbon capture and off-site sequestration.
'Dow is reprofiling the spending and pace of significant portions of the project as low GDP growth continues to impact our industry. The increased macroeconomic and geopolitical volatility are expected to persist in the near-term,' the company said in a statement to Global News.
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'As a result, we are slowing down field mobilization to match market timing and preserve cash until we see demand conditions improve.'
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A rendering of the Dow Chemical Path2Zero net-zero petrochemical project in the Industrial Heartland. Credit: Dow Chemical
It's not surprising amid the ongoing tariff moves being made by U.S. President Donald Trump and how the world markets have responded, according to economic experts.
'The Trump tariffs have thrown a wrench into a lot Canadian business plans where you have to make decisions that will have consequences for decades to come,' said Concordia University economist and Alberta resident Moshe Lander.
'When you're seeing the market go up and down, when you don't know where the tariffs are coming or going, you can imagine, then, a business is going to say, 'Wait, I want to sit this one out and make sure that what I think is a profitable investment is going to be a profitable investment' — and when you have the White House doing 180s on a day-to-day basis and then sometimes that 180 is doubling down on something they said previously, his is not at all surprising.
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'These are some of the consequences of tariff wars beyond just what it might mean for consumers.'
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The project was first announced in 2021, given the go-ahead after being fully financed in 2023, and construction began in 2024. The first phase was set to start up in 2027 and the second in 2029.
1:41
Major petrochemical investment announced in Alberta
Dow said it will complete home office (engineering and procurement) work to enhance construction readiness and in the coming weeks, the project's leadership will take time to look at the impact of the decision to pause further work.
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'The long-term strategic rationale of the Path2Zero project remains strong and we are committed to completing this project,' Dow said in its statement Thursday.
Lander said that statement should be taken with a grain of salt.
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'What are they going to say? 'We're only committed if things work out well, otherwise thanks but no thanks?' Of course they have to say, because in the event that they do proceed, they need to have the goodwill of the provincial government, of the local population, and of workers that would want to come work for a company that has to sunshine and happiness. Not negativity and pessimism,' he said.
When announced two years ago, Dow's Path2Zero facility was billed as the world's first net-zero Scope 1 and 2 greenhouse gas emissions-integrated ethylene cracker and derivatives site.
1:57
Major net-zero project announced for Alberta's industrial heartland
The project aimed to convert cracker off-gas into hydrogen as a clean fuel to be used in ethylene production. Carbon dioxide was to be captured on-site and then transported to be stored by adjacent partners.
The project was expected to increase the U.S. chemical company's polyethylene capacity by two million tonnes per year and decarbonize its global ethylene capacity by 20 per cent.
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Lander said with all the oil and gas knowledge and expertise accumulated in Alberta over the past century, a project of this nature would have been a great step in advancing the industry in the net-zero direction the world is moving.
'This is the type of thing that would be great for Alberta, great for the capital region, but it's also one of those things that its circumstances beyond our control, and there's only so much politicking that the premier can do,' Lander said.
'There's only so many trips she can make on taxpayer money down to the U.S. to try and elicit some sort of exemption, and there's so much threatening she can do of the federal government, whichever party it is.'
Lander said Dow's move may prompt companies involved in less profitable or riskier endeavours to follow suite in pausing plans.
'Projects could get cancelled, that might have been in the offing, or existing projects might get suspended on the grounds that there was an assumption maybe something was going to happen in the marketplace that is no longer happening,' Lander said.
'It has consequences that reverberate beyond just this one project.'
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The Alberta government said the Dow facility would produce 3.2 million metric tonnes of polyethylene and ethylene derivatives.
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1:54
Alberta premier speaks on future of Industrial Heartland
It was to provide up to 8,000 jobs during construction and 500 full-time jobs one it opened. Lander predicts the project will only resume if the global economy becomes more stable.
'The reality is at the end of the day, it's a for-profit firm. What speaks louder to me than anything else is not some press release, but the bottom line is the financials,' Lander said.
'If there's no profits to be had, I can guarantee you they are no more committed to Edmonton than to any other place in North America.'
Two federal tax credits — the carbon capture, utilization and storage investment tax credit as well as the clean hydrogen investment tax credit — were to provide up to $400 million in support of the project and were delivered upfront 'to get shovels in the ground,' MP Chrystia Freeland said at the time in 2023.
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The province also provided a 12 per cent grant worth $1.8 billion to the project through the Alberta Petrochemicals Incentive Program.
The energy minister's office said the pause is a business decision and all related questions should be directed to Dow.
'We are encouraged to hear that Dow continues to see this as a key corporate priority and that construction work remains ongoing, even if they are slowing down construction at the Path2Zero growth project in 2025,' the province said, adding the the project is very important for Alberta and the economy.
2:07
Alberta group eyes area north of Edmonton as kick-off point for clean energy industry
Last May, Canadian Utilities Ltd., a subsidiary of Calgary-based holding company ATCO Ltd., announced plans to build a new, $2-billion pipeline to supply natural gas to the Path2Zero facility.
The project was to be the largest-ever energy infrastructure project by an ATCO Energy Systems company.
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The new pipeline, called Yellowhead Mainline, will be around 200 km long and will run from the hamlet of Peers in west-central Alberta to the northeast Edmonton area.
It was expected to have the capacity to deliver one billion cubic feet per day of natural gas.
Construction on the new pipeline was expected to begin in 2026, Canadian Utilities said, with the aim to be operational in the fourth quarter of 2027.
Global News has reached out to ATCO to find out if Dow's decision to halt construction will also affect the Yellowhead Mainline. This story will be updated if a response is received.
— with files from Amanda Stephenson and Bill Graveland, The Canadian Press
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KULA is adding to its condiment line this summer with seasonings, such as Ethiopian berbere, Kenyan-inspired pili pili spice (which they've sampled as a hot chocolate beverage) and a curry blend highlighting Caribbean flavours — all without sodium. Working with Vancouver-based Maia Farms , KULA is infusing its seasonings with mycelium (the root structure of mushrooms). 'It's going to have oyster mushroom roots that add benefits to activate fibre, potassium and so much more,' says Wheeldon. Reformulating KULA's sauces sprung from Wheeldon challenging the conventional use of sugar. A two-tablespoon serving of standard barbecue sauce can easily contain more than 30 per cent of the daily value of added sugars. 'Why? That's dessert,' she says, laughing. Similarly, Wheeldon envisioned seasonings without sodium. Working with friend Karen McAthy, Maia Farms' director of food innovation, she arrived at adding functionality. Functional beverages (drinks with health benefits, such as those enhanced with protein or vitamins) have become increasingly popular, but Wheeldon hadn't seen many functional seasonings. Beyond the health aspect, she says they can bring more creativity into cooking. Mycelium is also a natural thickening agent and adds body to gravies, pastes, soups and stews. 'We use condiments in cooking, so why not add functionalities that will enhance our experience, whether it's the properties of cooking or the health benefits? If you can add fibre to more of your stews, why not? What excites me most is it allows us to expand our market reach around the types of customers we get. It's not just about veganism. It's about flavour. It's about health. It's about experience in the kitchen. So, it does create more expansiveness.' Ottawa-based Torshi started with an experiment. Tech entrepreneur and co-founder Aydin Mirzaee knew his mom, Nasrin Eslamdoost, was onto something with her torshi (Persian-style pickled vegetables). Every Christmas, Eslamdoost would visit him from New York, where she worked as a geneticist, and make a batch of torshi meant to last the year. It never made it past February. 'It was so frustrating because I was like, 'How do I get this?' I would go to stores, and of course, there are Persian stores and things like that, but there's nothing that tasted the same.' Aydin put the idea of a business aside until Eslamdoost retired and returned to Ottawa. When he suggested that she and his dad, Saeid Mirzaee (who teaches international law part-time at the University of Ottawa), join him in starting a torshi company, Eslamdoost was skeptical. So, Aydin proposed they evaluate the pickles' appeal on their non-Persian friends. The test wasn't about whether they said they liked them but about whether they voluntarily ate more. 'Sure enough, we did this, and the reception was really good. People would go for seconds. They'd finish the whole thing,' Aydin recalls. In September 2023, they took their experiment to the Beechwood farmers' market in Ottawa. On the first day, they sold 22 jars. 'All of us were like, 'Holy. This is crazy. People actually bought it.' We just kept not wanting to believe it,' says Aydin. They couched their success in the idea that farmers' market customers are inclined to support local and waited to see if there would be repeat purchases. There were. When Aydin saw that the domain was on auction, they took it as another sign that their Persian pickle company was meant to be. 'Slowly, my parents started to believe: 'We can do this. We can be entrepreneurs,'' says Aydin, laughing. 'I've been doing this entrepreneurial stuff my whole life, and so this is very natural to me, but for them, what I'm proud of is that, later on, they're doing this thing.' In 2024, Matin Moghaddam, who shares the co-founders' love of torshi, joined full-time as the general manager. Torshi — mixed vegetable , carrot and cauliflower — is now stocked in 93 stores across Canada, but Aydin has his sights set on 1,000. Crunchy and garlicky with the tang of an organic apple cider vinegar brine, their customers are putting torshi on charcuterie boards and in sandwiches and salads. Moghaddam says he used to think of torshi as an accompaniment, but seeing how people from other backgrounds are enjoying it, he appreciates its versatility. 'Now there are more doors and opportunities that we can explore.' Aydin and Moghaddam share the dream that, just like kimchi and hummus, one day, torshi will enter the Canadian lexicon. 'This is not an embedded word within Canada,' says Aydin. 'If you fast forward 10 years and everybody knows what torshi is, that would be crazy.' Moghaddam adds: 'That someone calls his wife and says, 'Can you buy some torshi?' and they understand each other's language. And they won't be like, 'What's that?' That's our vision.' To many, Kozlik's is more than a mustard — it's their mustard. 'I used to open the store at 5 a.m. with my father on the weekends, and people would come by with their group of friends, and they'd stop and say, 'This is my mustard.' And they'd really take ownership over that,' recalls Noah Kessler, director of business development and son of owner Jeremy Kessler. Kozlik's has been in the condiment game since 1948. Noah grew up participating in the business after his father bought it from late founder Anton Kozlik in 2000. Initially, they made mustard on-site at Toronto's St. Lawrence Market . One of Noah's first jobs at 11 years old was cutting labels and adhering them to jars with a glue stick. His father is a former photographer, so the lines had to be perfectly straight. Before they were in the mustard business, the Kesslers were Kozlik's customers. Jeremy went down to the market one day — between jobs on the cusp of the digital era — and came home with a book of recipes. 'Anton gave me a very good basic mustard education (he'd been making mustard for 50 years, so he knew a few things), and I seem to have a bit of a talent for it,' Jeremy told National Post in 2010. Mustard is a classic condiment, and Kozlik's is a time-honoured Canadian brand. One of Jeremy's lessons that stuck with Noah is that incremental changes add up. 'You may not notice the slight changes immediately, but when you look at it over time, they're substantial.' With a background in economics, Noah believes running a profitable business and making products you feel good about is possible. Carefully sourcing glass, caps and labels helps safeguard profitability without sacrificing quality. According to the Alberta Seed Guide , Canada is the world's top exporter of mustard seeds, and half of all mustard eaten globally is the product of Saskatchewan-grown seeds. When drought hit Western Canada in 2021, mustard farmers suffered, and a shortage followed. Noah says that prices soared by 300 per cent, spurring them to diversify their product line. If one of their input costs increases dramatically, they have other products to fill the gap. They also bought a German stone mill to grind whole mustard seeds, which they source from a farmer's co-op in the Prairies. In addition to more than 36 types of mustard , Kozlik's now makes barbecue sauces , horseradish , hot sauces and spice rubs . Yet, mustard is still its 'bread and butter.' Classic Dijon and Horseradish are the top sellers, and Triple Crunch , with its pop of acidity ('the poor man's caviar'), is a favourite with chefs. After 25 years in various roles in the mustard business, Noah appreciates its ability to enhance anything from dressings and marinades to hot dogs and pretzels. 'We like to say that good mustard can make bad food good and good food better.' And with the recent focus on all things Canadian, it's a shining example that often goes unnoticed. 'We used to joke when my father and I worked the weekends at the store. People would say, 'Oh, Canada grows all this mustard seed?' And we'd say, 'Yeah, it's very Canadian to do something well and not tell anyone about it.' And that was true. Nobody knew that Canada had this history and heritage in mustard. So, we like to be a part of that. It feels close to home.' Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark and sign up for our cookbook and recipe newsletter, Cook This, here .
