Federated Co-operatives Limited (FCL) announced on January 17 that it has indefinitely paused its ambitious Integrated Agriculture Complex project in Regina in Saskatchewan. The decision impacts two key components: a proposed renewable diesel facility and a joint venture canola crush plant.

Citing a confluence of factors, including regulatory and political uncertainty, potential shifts in low-carbon public policy, and escalating project costs, FCL has deemed it necessary to halt these endeavors.

"This wasn't an easy decision," acknowledged Heather Ryan, FCL CEO. "We conducted extensive due diligence, carefully evaluating the best path forward to meet compliance obligations while ensuring investments are sound and deliver value to our cooperative system."

The proposed canola crush facility, a joint venture with AGT Foods, was intended to supply feedstock to the renewable diesel plant. AGT Foods expressed its understanding of FCL's decision.

"Our partnership was founded on shared vision and values," stated Murad Al-Katib, President and CEO of AGT Foods. "While this JV isn't proceeding, agriculture remains a vital sector in Saskatchewan's economy, and we will continue to explore new investment opportunities."

Despite pausing these major projects, FCL remains committed to complying with the Federal Government's Clean Fuel Regulations. The company is actively investing in carbon capture technology at both the Co-op Refinery Complex (CRC) and the Co-op Ethanol Complex.

Furthermore, FCL plans to enhance its existing fuel production assets by incorporating co-processing and blending of renewable fuels at the CRC. This approach aims to ensure a sustainable and compliant fuel supply for the future.

Several factors contributed to FCL's decision to pause the project. The evolving regulatory landscape surrounding low-carbon fuels presents significant challenges for long-term investment planning.

The potential for changes in government policies related to renewable energy and carbon emissions creates uncertainty for project viability. Rising construction and operational costs, coupled with inflationary pressures, have significantly impacted the project's overall budget.

Impact on the Region:

The pause on the Integrated Agriculture Complex will have a significant impact on the Regina region. The project was expected to create numerous jobs and stimulate economic growth. However, FCL emphasizes its commitment to exploring alternative pathways to meet its environmental and sustainability goals.

FCL will continue to evaluate its options for meeting the requirements of the Clean Fuel Regulations. The company remains dedicated to its core values of sustainability and innovation while navigating the evolving energy landscape.

Federated Co-operatives Limited (FCL) is a Canadian wholesale and manufacturing cooperative serving over 160 independent retail co-operatives across Western Canada.