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Tuesday April 10th, 2012  
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Chamber Notice


Kimberley Massey photo
The Devon Canada natural gas plant west of Coleman, which has employed local families for the past 51 years, will be shut down by October, due to the age of the facility and plummeting price of natural gas.
Devon Canada announced last Tuesday, April 3rd that the company had made the decision to permanently close its Coleman natural gas plant.
According to Devon Canada Government and Public Affairs spokesperson Nadine Barber, the company made the difficult decision based on two major factors: the sustained low price of natural gas and the age of the Coleman facility.
“It is important that people understand this wasn’t an easy decision, but the right business decision was to permanently close the plant,” said Barber.
“We’ve taken a lot of time to evaluate all of our options and make sure we had exhausted all of our avenues.”
“Those two factors make it the right time to wind down the plant.”
Natural gas prices have reached a 14-year low in Canada in recent months, falling below $2 U.S. per British Thermal Unit (BTU) - approximately 1,055 joules - and the future price deck is forecast to remain around $2.53 for the remainder of 2012.
Experts say this drop-off in price is due mainly to warmer than normal winter weather diminishing demand and new natural gas discoveries creating record high inventories across the country (high supply, low demand).
In addition, Barber said the 51-year-old Coleman facility - which was purchased by Devon Canada from Morrison Petroleum in 1998 after having been purchased from Northstar Energy Services the year before - has long surpassed its lifespan.
She said the nearest facilities which are comparable in size and age are Shell Canada’s Waterton sour gas complex and the Nexen gas plant in Balzac, which was closed last April and is scheduled for demolition, adding that the nearest comparable Devon facility is in Red Deer.
“The Coleman plant is such a unique facility in the province that it’s hard to compare,” said Barber.
“Rarely do you see that size and scope of facility built any longer.”

Barber said the company found the combination of these two factors to be nearly insurmountable, prompting their decision to cancel operations.
The announcement was made to the plant’s 35 local employees last week and Barber said the company will continue to work with employees to determine other possible career options within the company.
“There are a lot of people who have been with this plant for a long time and they were the most important people to make aware of the decision,” said Barber.
“There will be ongoing conversations related to their future. We are reviewing staffing requirements in other areas of our operations.”
The company employs approximately 1,800 total employees at nine field offices throughout Alberta and British Columbia - as well as their head office in Calgary - with the closest facility to Crowsnest Pass being located in Turner Valley.
“We are reviewing staffing requirements in other areas of our operations,” said Barber.
“If there are any opportunities there, we will work with employees to see what those opportunities might be and if they are right for them.”
While it is still too early to set a definitive date, the plant is expected to be officially closed in early October and employees will remain on hand during the process.
Over the coming six to eight months, the company will be submitting a Decommissioning and Reclamation Plan to Alberta Environment and will continue to communicate with the community regarding the plant’s closure.
“There will be a lot of discussion back and forth with the community,” said Barber.
“We want to provide sufficient opportunities to make sure people are aware of the entire process.”
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