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CHRIS WATTIE/Reuters

TransAlta Corp. says it is partnering with SemCAMS Midstream ULC to build a $105-million power-and-steam cogeneration facility at a natural gas processing plant near Fox Creek in northern Alberta.

TransAlta says it will pay for and construct the 40-megawatt plant and SemCAMS has agreed to buy a 50 per cent stake when it begins operating in late 2021.

All of the steam produced at the facility and about half of the electricity are to be sold to SemCAMS under a 13-year fixed price contract, with the remainder of the electricity sold into the Alberta grid.

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The partners say the cogeneration facility will eliminate the need for traditional boilers and reduce annual carbon emissions of the operation by about 100,000 tonnes of carbon dioxide equivalent, equal to the emissions of 20,000 vehicles.

In September, Calgary-based TransAlta unveiled a $2-billion clean energy investment plan to convert its Alberta coal-fired generating facilities to natural gas and complete construction of four wind power projects in the United States and Alberta.

TransAlta CEO Dawn Farrell says the project with SemCAMS will greatly increase the energy efficiency of the existing gas plant.

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