Ran into the same problem today on a Digital Ocean VPS with 512MB RAM. Since the droplet does not have swap space, I decided to added it, by running the following commands as root:
touch /var/swap.img
chmod 600 /var/swap.img
dd if=/dev/zero of=/var/swap.img bs=1024k count=1000
mkswap /var/swap.img
swapon /var/swap.img
echo "/var/swap.img none swap sw 0 0" >> /etc/fstab
It adds 1GB of swap space.
A second deployment didn't complain about the heap space anymore.
However, in my case, the SBT build failed later on during the deployment. Resizing the droplet to 1024MB did the trick and Dokku reports the application as being deployed.