A small green power company says it has closed a deal to buy a half-built oil sands power plant in northern Alberta halted 16 months ago by international oil giant Royal Dutch Shell.
Kineticor Resource Corp. says it has partnered with Ontario pension fund OPTrust to buy the 690-megawatt plant, one of the remaining vestiges of an Alberta oil sands building boom stalled by crashing global oil prices and doubts about pipeline access to markets.
CEO Andrew Plaunt says Kineticor plans to finish and repurpose the facility, which will use natural gas, as a standalone power plant to help replace coal power that the province has vowed to phase out by 2030.
The Calgary-based company says OPTrust — the pension plan for unionized Ontario public sector and Crown employees, with $18 billion in assets — has agreed to invest $125 million in Kineticor.
Neither Shell nor Kineticor would provide a price or other details of the agreement. A spokesman for Kineticor wouldn't say when construction to complete the facility is expected to begin.
The cogeneration plant was being built as part of Shell's 80,000-barrel-per-day Carmon Creek oil sands project near Peace River. The company shelved the project in October 2015 and announced a resulting $2-billion asset impairment charge.