Advanced Gasification System Developers Push Forward
Posted on: Monday, 12 November 2007, 09:00 CST
Advanced gasification systems (AGS) developers are focusing on producing methane directly from coal and petcoke as US generators turn to natural-gas combined-cycle plants to increase baseload capacity and reduce CO2.
Smaller, cheaper, more modular gasification systems are needed to supply cheaper gas to industrial customers that cannot compete with global companies using cheaper feedstocks. The holdup of US IGCC development has created an opportunity for AGS suppliers to offer gasifiers with higher availability and reactors that can be bolted on at the site.
However, the AGS market is facing the many of the same delays as the US IGCC market, largely due to sharply escalating construction costs and CO2-regulation uncertainty.
"Nobody wants to be the person who signs the order to get the first plant built if they are going to lose $300 million with the plant, even though there is $2 trillion market out there," Eric Redman, gasification lawyer with Heller Ehrman, told the audience at the Advanced Gasification Systems conference in Houston, Nov. 1, hosted by SYNGAS Refiner.
"The venture capitalists want too much and you can't get a project financed if you require any debt because private equity is a big money program that is very, very cautious about technology plays," explained Redman. "Industrial giants, such as GE, Siemens, and the oil and gas industry, are the companies you want backing you."
Dow Chemical is investing in Great Point Energy that will be building a 1 to 3-tpd coal-to-methane pilot plant at Brayton Point, MA and a 40-to-50p-tpd commercial plant in Alberta or the US Gulf Coast using petroleum coke.
In addition, Redman said the use of post-combustion technology to capture CO2 has become a real problem for coal gasification. "This has caused confusion and has given time for the environmental community to come out strongly against any coal plants," he said.
Another obstacle for the AGS market is the lack of pilot projects, and even fewer scaled-up commercial projects. "It's very hard to take people to see the technologies in operation, unlike China, where potential investors can actually see operating plants," Redman said.
SYNGAS Refiner, published by the Zeus Development Corporation, is following these developments and more with its twice-monthly newsletter and real-time email news service. More online at www.SYNGASRefiner.com.
Contact: Amy Nussmeier VP, Sales & Marketing Zeus Development Corp. 713-952-9500
SOURCE: Zeus Development Corporation
Source: MARKET WIRE
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