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Lake Charles Clean Energy

Brief description:




Facts:




Country: USA

Project type: Capture Storage

Scale: Large

Status: Cancelled

Year of operation 2014
Industry: Methanol production


New or retrofit: New
Transport of CO2 by: Pipeline

Type of storage: EOR

Volume: 4.5 million tonnes/CO2


 

Lake Charles, Louisiana

Leucadia Energy aims to demonstrate CO2 capture at its planned petroleum coke-to-chemicals plant being developed at the Port of Lake Charles in south west Louisiana. The plant will produce methanol, hydrogen and other products used in the chemical and refining industries.

The plant is designed to capture, compress and sell 90% of its CO2 emissions, and the captured CO2 will be transported via the 320-mile Green Pipeline for use in Denbury Resources' EOR operations in the US Gulf Coast. The project is expected to sequester 4.5 million tonnes per year of CO2.

The overall goal of the demonstration plant is to develop CCS technologies for commercial-scale use and integrated with EOR operations. The infrastructure developed could potentially be used by other industrial emitters in the Lake Charles area. The project will make use of ship, barge and rail facilities afforded by its proximity to the Port of Lake Charles.

Construction will be carried out by Turner Industries Group, while KBR will provide design, engineering and procurement services. The project team also includes General Electric, Haldor Topsoe, Black & Veatch, and The University of Texas Bureau of Economic Geology.

Financing

The project requires investment of around $2.5 billion. As of October 2012, Leucadia Energy had secured long-term commercial offtake contracts with BP Products (for methanol), Air Products (hydrogen and argon) and Denbury Onshore (for CO2), which allows it to seek third-party financing that will determine the final investment decision.

In June 2010, Leucadia was awarded second-phase funding of $260 million from the US Department of Energy’s (DoE) Industrial Carbon Capture and Sequestration (ICCS) Program – through the American Recovery and Reinvestment Act. It received a phase-one award from the DOE of $840,000 in 2009. The project has also been awarded $1.56 billion of Gulf Opportunity Zone and Hurricane Ike tax-exempt bonds by the Louisiana State Bond Commission, showing state support for the project, and has $128 million federal investment tax credit under IRS Section 48B.

Timing

The project was cancelled due to estimated high costs in 2014.

More information and press releases

DOE issues final approval for Lake Charles CCS project funding, January 6, 2014

LCCE announces contracts, 29 October 2012

TV news report, 29 October 2012

Project progress, GHG Monitor article, September 2012

NETL project factsheet

DOE press release re second-phase funding, 10 June 2010

DOE techline article re second-phase funding, 10 June 2010

Twelve projects selected for US CCS funding, 5 October 2009




Companies involved






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