Canadian grocery giant Loblaws is setting up a giant warehouse for western Canada near Regina.

Saskatchewan Premier Brad Wall announced Tuesday that Loblaw Companies Ltd. will go ahead with a 93,000-square-metre (one-million-square-foot) distribution centre five kilometres west of the city.

The warehouse will generate 750 jobs within two years and as many as 1,500 jobs by 2017, Wall said.

The new distribution facility, which will be owned and operated by a third party logistics firm on behalf of Loblaws, will be located next to a Canadian Pacific Railway line.

The project is designed to tie into a massive rail and truck transportation hub previously announced by the government.

The "third party logistics provider" wasn't identified in the government news release.

Construction is expected to begin this fall. The province said it will upgrade highways in the area to help accommodate an extra 1,400 trucks a week.

The government says the project will result in a $200-million investment in Saskatchewan.

Loblaw Companies Ltd. operates stores in Saskatchewan under various names, including Extra Foods and Real Canadian Superstore.