Meta and Pembina Partner to Build Alberta AI Data Hub

Meta is about to sign a contract with energy infrastructure company Pembina Pipeline to construct a large AI data centre northeast of Edmonton, according to three people familiar with the proposal who spoke to The Logic.

With the agreement, Alberta would take a significant step towards its goal of becoming a data centre for some of the biggest AI hyperscalers in the world, partly by using the province’s natural gas resources to produce electricity.

Two sources admit and claim that Pembina will collaborate with Kineticor, a fellow Calgary business that offers power generation facilities, to furnish the project with natural gas-fired electricity. One insider informed The Logic that Beacon AI, a data centre business based in Calgary, was also involved in the transaction.

Some regulatory parts of the development might be announced as early as Friday, according to insiders, but the deal’s final terms were still being worked out. The Alberta premier’s office, Meta, Pembina, Kineticor, and Beacon AI did not immediately reply to enquiries.

Since the sources were not authorised to talk publicly on the subject, the Logic consented to keep their names confidential.

If Meta’s development is successful, it will significantly advance Alberta’s AI aspirations. The province’s government has been aggressively pursuing Silicon Valley tech companies in the hopes of leveraging its extensive natural gas network to establish Alberta as a hub for data centres.

The Industrial Heartland, a collection of petrochemical factories, oil refineries, and other enterprises close to Fort Saskatchewan, Alta, is where the Meta complex would be situated. It is also a centre for carbon capture and storage technology, which might help Meta and other big tech companies reduce carbon emissions associated with AI.

The initiative is being proposed as major giants like Microsoft, Amazon, Alphabet, and Meta compete to increase AI capabilities, which need massive amounts of energy to run and train systems. Microsoft is among the companies who have chosen to use nuclear power to power their operations in order to reduce emissions. Nonetheless, businesses are looking at natural gas power in the near future due to the lack of nuclear capacity in many places and the lengthy construction schedules.

One of the most active companies in the pursuit of computing capacity is Meta, which recently revealed plans to build a 1,000 megawatt facility in Ohio and a 5,000 megawatt data centre in Louisiana.

A joint venture between Pembina and Kineticor was established earlier this year to build the 1,800 megawatt Greenlight Electricity Centre (GLEC), a natural gas power plant situated in the Industrial Heartland. The plant will be developed in 450 megawatt chunks, and the businesses have planned it to allow for the future addition of carbon capture capability. In 2029, it is anticipated to begin commercial operations.

Upon announcing the project in February, Kineticor stated that the station could either feed directly into Alberta’s power grid to service data centres throughout the province or provide electricity to a data centre constructed at the same location.

Whether the GLEC would serve as a power supply for the Meta data centre or not, it was not considered by Kineticor or Pembina.

The Alliance pipeline, a nearly 3,800-kilometer network that connects northern British Columbia and Alberta to Chicago, is how Pembina would supply gas to the facility, according to a source familiar with the project. In July, Pembina declared that it was assessing the possibility of extending the pipeline to supply 350 million cubic feet of gas daily to the Industrial Heartland, with the pipeline expected to come online in 2029. 

Meta’s and other AI data centres have enormous energy requirements. Also approximately 8% of the approximately 23,000 megawatts that Alberta’s whole system can currently produce would be needed for a 1,800 megawatt project alone. The data center’s anticipated capacity and the amount of power it intends to use from GLEC or other possible power sources were not immediately confirmed by Meta.

According to two sources, some developers, including Meta, were incensed by the Alberta government’s recent decision to impose a two percent charge on data centres. Since then, the province has committed to updating the policy.