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Indiana Gasification Wins Air Permit for Clean Coal Facility, Says Plant a Big Win for Environment and Indiana’s Energy Future

June 28, 2012

$100 Million in Savings for Consumers, 1,500 Jobs, CO2 to Boost Oil Production

ROCKPORT, Ind., June 28, 2012 /PRNewswire-USNewswire/ — Indiana Gasification said yesterday’s decision by the Indiana Department of Environmental Management (IDEM) to issue the air permit for IG’s clean coal facility is a major step toward construction of the state-of-the-art plant.

“The IDEM air permit is critical to an IG plant that promises huge energy and economic benefits. Our plant will produce both substitute natural gas for Hoosier consumers and CO2 that will be piped to the Gulf States, enabling America’s oil production to increase by tens of millions of barrels a year,” said Bill Rosenberg, an IG partner and a former Assistant Administrator for Air at the U.S. Environmental Protection Agency.

“The cleanest coal plant ever permitted in the United States, the IG facility will directly create about 1,500 high-paying jobs. Construction of the plant will require 1,000 workers and take three years. The plant will employ 200 people, with its annual demand for 3.5 million tons of coal expected to create another 300 jobs,” Rosenberg said. “This doesn’t count the multiplier effect in the Southwest Indiana economy,” he added. “This home-grown energy means that about $250 million a year will be spent in Indiana instead of leaving for some state or country that drills for natural gas,” Rosenberg said.

The IG facility will provide approximately 17 percent of Indiana’s residential and commercial natural gas requirements. Under a contract negotiated with the Indiana Finance Authority, consumers are guaranteed savings of at least $100 million over 30 years and are protected against the full effect of notoriously volatile natural gas prices, Rosenberg said.

The $2.8 billion plant also demonstrates that clean coal technology is available, feasible, and affordable. It must remain an integral component of the “all-of-the-above” approach to domestic energy production endorsed by Democrats and Republicans as well as numerous energy experts.

The IDEM permit is just the most recent regulatory endorsement of the IG project. The U.S. Department of Energy (DOE) earlier this month filed an amended notice of intent to include the CO2 pipeline in the project’s loan guarantee financing and environmental impact statement. Also in June, IDEM issued a draft Clean Water Act permit for the Rockport plant. If all goes as planned, construction will begin in late 2013.

The IG plant will not burn coal. Instead, the gasification process will convert approximately 10,000 tons of coal per day into substitute natural gas (SNG) and liquefied carbon dioxide (CO2). About 80 percent of the plant’s SNG output will be sold to the Indiana Finance Authority under an agreement that protects Indiana ratepayers. Because the facility will gasify coal, it will achieve extremely low air emissions, much lower than those produced by traditional coal-fired plants.

The CO2 produced by the IG facility will be compressed, sold and shipped from Indiana to the Gulf Coast and injected into depleted oil wells for enhanced oil production. This enhanced oil recovery (EOR) effort will produce 10 million to 20 million barrels of oil annually that could lead to substantial reductions in imports of oil.

The use of CO2 produced from plants like the IG facility and shipped by pipeline to oil-producing states for use in EOR is one of the most promising and innovative energy technologies. In a June 22 study for DOE, the National Coal Council called for the increased capture of CO2 from coal plants and transportation through a national network of pipelines that could boost oil production through EOR by 3.5 millions of barrels a day.

“We appreciate the strong support the IG facility has received by parties looking out for the energy and environmental future of the state, which benefits from the production of stable, long-term, clean energy in Indiana with local workforce and resources,” Rosenberg said.

To view IDEM’s air permit, please visit: http://permits.air.idem.in.gov/30464f.pdf

Below is a fact sheet.

FACT SHEET: INDIANA GASIFICATION, LLC

Detailed Highlights from the Final Air Permit and Draft Water Permit

June 2012

Feedstock

  • At design, annual usage of approx. 3.85 million tons of Illinois Basin coal, with the possibility of substituting a portion of this with petroleum coke.

Annual Substitute Natural Gas (SNG) Production

  • Approximately 47 million mmBtu (about 38 million mmBtu will be sold to the Indiana Finance Authority, equivalent to approximately 17 percent of the amount used by residential and commercial customers in Indiana)

Annual Liquefied Carbon Dioxide (CO(2)) Production

  • Approximately 5.5 million tons
  • Will be sold for use in enhanced oil recovery operations in the Gulf Coast Region (estimated to help produce 10,000,000 to 20,000,000 barrels per year of additional domestic oil)[1]

Emissions Performance Highlights

  • As a result of using gasification technology and state-of-the-art controls, permitted emissions will be extremely low (in tons per year):
    • NO(x) – 127
    • CO – 634
    • VOC – 16
    • SO(2) – 100
    • PM-10 – 67
    • HAPs – 19
  • In contrast, a typical coal-fired power plant will emit at significantly higher rates. For example, the Vectren coal electric fleet of three facilities in this region burned an amount of coal in 2009 and 2010 equal to approximately 80% annually of the amount of coal that will be processed by Indiana Gasification. Vectren’s plants released 9,400 tons of SO(2) annually. Indiana Gasification has requested a permit limit of approximately 100 tons of SO(2) annually.
  • The Indiana Gasification facility will also emit significantly smaller amounts of lead and mercury than comparable facilities. The proposed permit for the Indiana Gasification facility allows for approximately ten times less lead emissions than nearby traditional coal-fired power plants and half as much lead emissions than comparable IGCC facilities on a per ton of coal basis. As for mercury, the proposed permit for the Indiana Gasification facility allows for approximately seventy times less mercury emissions than nearby traditional coal-fired power plants and three times less mercury emissions than comparable IGCC facilities on a per ton of coal basis. This means that less than 4 lbs./year of mercury will be emitted from the facility.

Clean Air Act Permit Status
The Indiana Department of Environmental Management (IDEM) issued its final Clean Air Act construction and operating permit on June 27, 2012. To view IDEM’s air permit, please visit: http://permits.air.idem.in.gov/30464f.pdf

Clean Water Act Highlights

  • The water permit application provides for water to come from the Ohio River. Average usage equates to approximately 0.2% of river flow at low flow conditions. No water will come from area aquifers.
  • The facility will collect stormwater that falls on various areas of the plant for use in the process, which will result in both reducing water usage from the Ohio River and reducing the potential for discharge of coal contaminated stormwater.
  • The facility will filter and reuse the majority of the wastewater coming from the gasification process, with the residual evaporated. There will be no discharge of gasification process wastewaters.
  • Water discharges will include stormwater and non-process waters from the cooling towers, boiler, and reverse osmosis systems. Discharges will meet effluent requirements of wastewater discharge regulations.
  • IDEM published the draft Clean Water Act permit for public comment on May 31, 2012. A public hearing is scheduled in Rockport for July 10, 2012. To view IDEM’s draft permit, please visit: http://www.in.gov/idem/5338.htm

Byproducts

  • Sulfur in the feedstock will be processed into sulfuric acid, which Indiana Gasification will sell into the industrial market.
  • Heat generated during the gasification process will be used to produce steam for steam turbines that can produce approximately 300 MW to meet essentially all on-site power needs, with utility interconnection for minor power balancing.

[1] Assumes an average value of 0.25 metric tons of CO(2) per incremental barrel of oil produced. See Advanced Resources International, U.S. Oil Production Potential from Accelerated Deployment of Carbon Capture and Storage, March 2010 (p. 20). Paper indicates average values of 0.22 to 0.28 metric tons of CO(2) per incremental barrel of oil under different scenarios.

SOURCE Indiana Gasification


Source: PR Newswire