Jan 20, 2008 - 04:05:26 CST
After years planning a new power plant near South Heart, a company that owns vast coal reserves in North Dakota shifted a major gear and will gasify coal into a synthetic natural gas instead.Great Northern Power Development made that announcement in December, catching industry-watchers by surprise.
One of the main reasons to shift: Impending requirements to capture carbon dioxide, an invisible, odorless gas that's blamed for, along with other gases, contributing to global warming.
The company is a subsidiary of Houston-based Quintana, which in 1992 purchased a 20-billion-ton coal reserve that formerly belonged to Burlington Northern Railroad.
Quintana formed Great Northern to develop the reserves in North Dakota and Montana. So far, the South Heart project is its foremost advance.
Rich Voss, Great Northern vice president, said during seven years, the company encountered hurdle after hurdle trying to develop a power plant. It had trouble identifying or upgrading enough room on the transmission grid. It also had trouble getting customers to sign the bottom line on power purchase agreements.
The straw that broke the power plant back was strong signals from Congress that carbon capture rules for the energy industry are in development.
The technology to capture carbon from the power plant process is still in development and estimated to add as much as 40 percent to construction. "It's a huge cost," Voss said.
Building a gasification plant, similar to but more advanced than Dakota Gasification Co.'s synthetic gas plant at Beulah, knocked down hurdle after hurdle, Voss said.
The synthetic gas can be dumped into the Northern Border Pipeline or the Williston Basin Interstate Pipeline, both close to South Heart, with plenty of takers at the distribution ends, Voss said.
Transmission and purchase problems disappear.
It also solves the carbon capture problem, because CO2 is stripped off in gasification and instead can be a valuable commodity.
The carbon capture problem disappears.
DGC, near Beulah, sells much of the CO2 it strips from lignite to Canadian oil producers who inject it underground to enhance oil recovery. DGC has never disclosed the value of the CO2 it sells to Canada, but Voss figures Great Northern would be competitive in the CO2 market.
Congress is likely to require some form of sequestration and injecting CO2 for oil recovery accomplishes both capture and sequestration.
Voss said he believes Great Northern could do the same at South Heart, where oil jacks are pumping in virtually every direction around.
Great Northern expects to spend $1.4 billion to build a plant to gasify 5 million tons of coal into 90 million cubic feet daily of synthetic natural gas. That also includes opening a coal mine near the plant site. A public meeting to detail mine plans will be held at 6:30 p.m. Wednesday at the South Heart school gym.
The company withdrew its air quality permit application for a power plant project and will submit a revised application for a gasification plant, hopefully in late summer, Voss said.
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