Strathcona County

The Centre of Alberta’s Industrial Heartland

Strathcona County is a designated specialized municipality of 100,000 people in central Alberta, located between Edmonton and Elk Island National Park and carries with it a unique blend of urban and rural characteristics. As home to the province’s Industrial Heartland, the region accounts for about three quarters of Western Canada’s refining industry and a sizable portion of its agricultural production.

The Industrial Heartland consists of five local municipalities – Strathcona County, Sturgeon County, Lamont County, the City of Fort Saskatchewan, and the City of Edmonton, just 25km to the west. The metro area has now surpassed 1.4 million people and is widely recognized as one of Canada’s leading economic territories.

The Canadian Business Journal recently spoke with Strathcona County Mayor Rod Frank and Gerry Gabinet, Director Economic Development and Tourism about the County and its incredible economic successes. The designation as a “specialized community” was introduced in 1996 as a means of simultaneously accommodating the needs of both urban and rural development.

Because Strathcona County does have such a unique mix of urban and rural economic industries, it opens up the possibilities for provincial grants that would not otherwise be available.

“We get treated as an urban centre by the provincial government for certain grants or certain matters pertinent to our relationship. On the other hand that relationship doesn’t work we’re talking about our rural base, but at the same time there are programs available to rural Alberta and we qualify for those also,” begins Mayor Frank.

Another fundamental advantage of the mixed rural-urban environment is Strathcona County’s ability to leverage itself as a city, as opposed to a village or small town.

“It gives us the benefit of having an industrial area within the county that is zoned heavy industrial and receives the tax base from that for the benefit of the entire county,” states Gabinet.

On the agriculture side there are only six countries in the world that are exporters of food and Canada is one of them with western Canada and Alberta being acknowledged leaders with a value of about $840 million per year for the Edmonton region.

“We have a thriving agricultural industry and we’re learning how to better incorporate urban and rural environments,” says Frank.

As evidence of continued maturation in the sector, a multi-purpose agricultural facility will be a destination where residents from across the County can enjoy a variety of agricultural, community and social events. It will be located on a 150-acre parcel of land surrounding the historic Bremner Heritage Site, a 15-minute drive northeast of Sherwood Park.

As of 2018, about 66% of Strathcona County’s tax base comes from the non-residential sector with the remaining 34% being generated from the residential side. It’s an efficient baseline ratio that local politicians have been able to consistently maintain over the years.

Canada’s Energy Engine

The refineries and petrochemical companies spearhead the municipality’s well-established economic engine. Gabinet and his staff are constantly seeking out ways to enhance value-added business opportunities. An example of such an endeavor involves a major project of turning propane into propylene – tiny plastic pellets.

A local company called Inter Pipeline recently announced a $4.1 billion project in Strathcona County’s section of the Heartland, with $600 million of that being allocated to a central utilities building. The Heartland Petrochemical Complex will be designed to convert locally sourced, low-cost propane into 525,000 tons per year of polypropylene, a high value, easy to transport plastic used in the manufacturing of a wide range of finished products.

Consisting of a propane dehydrogenation and a polypropylene facility, the Heartland Petrochemical Complex will be located in Strathcona County, near Inter Pipeline’s existing Redwater Olefinic Fractionator.

“What we’re doing is looking at something worth 20 to 30 cents per pound and by the time the value-added happens it’s about $1.50 per pound,” explains Gabinet.

Strathcona County is often referred to as “Canada’s Energy Engine”, a name that took hold after World War Two when refineries in Northern Canada had not managed to take hold with complete conviction. Imperial Oil then made a corporate decision to set up operations in Strathcona County and that is essentially what marked the beginning of a long and successful industry that is now moved beyond seven decades. There are currently nine major refineries in Western Canada, three of which are in Strathcona County, namely Imperial Oil, Suncor and Shell.

“In Strathcona County we refined approximately 67% of all the oil in Western Canada. We’re really proud of that. We’ve got a real heritage of oil and gas out here,” says Gabinet.

“It was hugely successful from the outset and it grew organically from that. It’s also how one of our major urban centres, Sherwood Park, grew alongside of the Strathcona Industrial Association,” adds Frank.

As the industry began to take shape about 25 years ago the local politicians realized that there was an opportunity to unify and create the Alberta Industrial Heartland Association. The refineries and petrochemical industry grew exponentially and there’s been no looking back.

“It took a lot of foresight to get five municipalities to cooperate but part of the idea was to get enough land together for industry to have its own property and infrastructure in terms of roads, water and wastewater and create a value-add, ready-made area for industry to move into,” continues Frank.

Both Mayor Frank and Gabinet are also extremely proud of how the industry has taken on exceptional safety and environmental responsibilities along the way, which has led to an outstanding record and reputation.

“We now stack up against any region in the world in terms of advanced policies,” remarks Frank. “We’re situated about half a distance to major Asian markets compared to our competitors in the Gulf Coast and so our green footprint is so much better. If you are pro-environment this is the place that you want to do business in North America.”

A substantive amount of the success can be attributed to excellent foresight and some of it has been due to good fortune in terms of physical location. However, there are other jurisdictions in Alberta that could have taken the same opportunity and run with it, but it was Strathcona County, Sturgeon County, Lamont County, Edmonton and Fort Saskatchewan that got behind it and created the multi-billion industry that it is today. The high-paying jobs are a direct reflection of just how strong the local economy has become with the average family income in Strathcona County at about 161,000.

Construction & Retail Expansion

As the County continues to expand its economic base the potential for retail growth has flourished, primarily in Sherwood Park, where about two-thirds of the County’s entire population resides. Despite a population of about 70,000 Sherwood Park has maintained its status as a hamlet and is recognized as an urban service area.

Gabinet and his nine-member economic development team put together a retail market study about six years ago, and the result has been a noticeable upturn in new retail development.

“We’re involved with a major organization called the International Council of Shopping Centres (ICSC). I’m on the board for Canada as the P3 chair talking about the importance of working with local retailers to supply goods and services to our particular area,” reveals Gabinet.

It’s quite evident the region is blessed with a number of outstanding retail services. One example is the Sherwood Ford auto dealership, which is the third-busiest Ford dealership in Canada.

As an extension to the residential and retail development, the construction industry has also benefitted tremendously with the advanced infrastructure requirements.

“Much of the construction industry is headquartered in the metro region and out here in Strathcona County. They always look forward to hearing the opportunity for bidding on the major projects that are going forward and also doing what they call the turnaround stuff as well. When the refineries have a shutdown they redo the pipes and electronics and many other maintenance requirements that are necessary,” says Gabinet.

For every $1 that is spent on the oil and gas industry, $4 is created in other areas of the economy as a job multiplier for Strathcona County. But it’s not just about local and regional benefits; it’s also about reaching right across Canada. To that end, many firms are looking at doing business here in Strathcona County and working effectively as well.

“Our new mayor and council are really top business supporters. Whenever we have the opportunity of having a major client within our county coming forward we have an open-door policy that we can contact the mayor’s office and we can have a one-on-one meeting to discuss business opportunities going forward,” says Gabinet.

Linking Heavy Industry and Energy

A noticeable lineage has been created whereby Strathcona County acts much like a conduit between the heavy industry in the north such as Fort McMurray and the corporate end of the energy sector to the south in Calgary.

“We’ve been asked by several economic groups from northern Alberta for them to come down here and do a case study to examine the best practices that we’ve done in establishing Alberta’s industrial heartland and also the Strathcona industrial area as well,” says Gabinet.

Additionally, Gabinet ensures that members of his economic development team travel to Calgary at least three times a year to talk with head offices and share information about a number of economic opportunities that are either on the near-term horizon or future planning down the road.

The current mayor and council have done an excellent job in reducing taxes over the last two years by 2.61% and 2.18%, respectively. Strathcona County has always had a reputation for its business friendly environment and an ability to cut out a lot of the frustrating bureaucratic red tape that is often seen in other jurisdictions.

Mayor Frank entered into the position with a number of plans for Strathcona County and he is well aware that running a government is much different than running a business.

“Our administration came in with the full intent of being fiscally responsible. In my previous life I was a corporate lawyer for TELUS and I was trained in that environment. I always want to know the business case and the financial case and what the payoff is for the taxpayer,” he says.

Both Mayor Frank and Gabinet are adamant that Strathcona County will never be regarded as being a ‘one-horse town’. Extensive diversification objectives and bitumen upgrading is a big part of the plans moving forward with the polypropylene industry. There has been more than $3.5 billion in investments from Inter Pipeline in the last year and much more is anticipated. There has also been a strong push towards green initiatives and excellent support for all Indigenous groups.

“Kinder Morgan starts in this county; this is ground zero and we’re going to see that pipeline through. We are developing responsibly,” emphasizes Frank.

Edmonton Global

Edmonton Global is the first fully regional economic development company for the Edmonton Metropolitan Region and was incorporated on June 9, 2017. The organization was established to advance economic development cooperation amongst stakeholders of the Edmonton Metropolitan Region, to promote the region globally, and to attract and retain business investment and trade for the region. Edmonton Global takes the model of the industrial heartland and focuses on areas outside of the traditional energy sectors. Identifying possible new industries is an ongoing process, but healthcare and artificial intelligence are two areas that have already shown excellent early-stage potential.

In support of these other burgeoning industries is a very robust educational system throughout the entire Edmonton region with five universities and technical schools in the metropolitan area.

“Between education and the high quality of life we are able to retain our skilled workers. Competing as a region is what it’s all about. We are hunting as a pack to attract industry North American-wide,” says Frank.

“Part of our diversification strategy is to be sure that other groups are aware of that and the amount of opportunities they have for people that are involved in that particular sector as well. It’s a bit of a spinoff in the IT sector moving forward,” adds Gabinet.

Mayor Frank and Gabinet say that Strathcona County is also looking to make a serious move into the manufacturing sector.

“In 2022 we’re going to be producing plastic pellets and if there’s some way that we can find a market niche for ourselves to do the actual manufacturing, utilizing the polypropylene and shipping it across North America and the world, based on our cost advantage here as well,” notes Gabinet.

“This all requires long-term strategies. It takes a lot of time to make sure you get your name out there.
“I often joke that a deal is an overnight success, five years in the making,” chuckles Gabinet.

The economic development department led by Gabinet consists of a team of nine professionals. One manager works exclusively on attracting manufacturing and international manufacturing, primarily relating to heavy industrial. Joint trade missions with Alberta’s industrial heartland have resulted in business expeditions to Europe, Asia, the Middle East and North America.

“Our department puts together videos celebrating the successes of local businesses,” says Gabinet.

Local Events & Recreation

An essential aspect for any successful thriving community is that it be safe and is equipped with an excellent education system. From that point of view, Strathcona County earns an A+. The mayor and the County staff are currently undergoing a revision of the recreation strategy and looking forward to a lot of input from local businesses and residents.

Each year there are a number of entertainment events relating to sports, recreation and festivals that provide an outstanding community spirit. Canada Day is a celebration that everyone can enjoy and a no-alcohol on-site policy ensures the retention of the family values aspect and there are no charges to attend any of the events. The July 1 event typically attracts about 35,000 people. There is also another event called Savor Strathcona that showcases local restaurants and local food.

“There are also a lot of events associated with sport tourism,” says Frank. “Our director of recreation, parks and culture is on Canada’s Olympic Commission so he has the opportunity to find out about national training events and we have the chance to bid on having those events come to Strathcona County.”

Strathcona County has hosted its share of prestigious athletic events including the 2007 Western Canada Summer Games and just recently the Over-55 Games.

Oftentimes many entertainment acts are not large enough to sell out Rogers Place in downtown Edmonton, which is where Festival Place comes into play. It’s a 1,500-seat auditorium that attracts various members of the performing arts including dance, theatre, magic and musical groups throughout the year.

Strathcona County is also the proud home of the Beaver Hills Biosphere, designated as a Biosphere on March 19, 2016 by the United Nations Educational, Scientific and Cultural Organization (UNESCO). This designation provides global recognition of the community’s commitment to conservation and sustainable development.

“With that status we have been able to preserve and recognize very unique landscapes in the County. It’s suitable for great hiking experiences with rolling hills and lakes and it’s ecologically friendly. There is a lot of bio-diversity,” explains Gabinet.

“We are developing our energy responsibly. Canadians can be proud of this region,” emphasizes Frank.

The Alberta Industrial Heartland, the Strathcona Industrial Association and Edmonton Global have all become major success stories and will continue to pay dividends for the entire region for many years to come.

In looking to the future Mayor Frank makes it abundantly clear that he is determined to be financially responsible and that deficit financing is not part of the game-plan. Raising the standard of living and quality of life is part of the master plan.

“We’ve set a very ambitious goal, which we call 30-by-30. We are looking for $30 billion of investment in the industrial heartland by the year 2030,” continues Frank. “We’ve identified the specific projects that we feel we can deliver on. By 2020, I’ll be happy if we hit $10 billion of that.”

There is some government funding that will be made available for partial upgrading and there’s another one for the petrochemical diversification fund. Inter Pipeline is getting $200 million worth of tax credits and Pembina is receiving $300 million in tax credits and they’re making their final investment decision,” states Gabinet.

Strathcona County offers an excellent high-standard of living, with very good paying jobs, wonderful urban amenities and beautiful rural landscapes. Both Mayor Frank and Gabinet can’t think of a place they would rather live and work.

www.strathcona.ca

Recommended
COVER - Electric CarsCBJ June 2018