$4.5 billion facility in Ascension Parish to be Louisiana's first carbon capture project

$4.5 billion facility in Ascension Parish to be Louisiana's first carbon capture project

A Pennsylvania company plans to build a $4.5 billion clean energy facility in Ascension Parish that would be the state's first carbon capture project. 

Air Products said it will build a blue hydrogen manufacturing complex near Burnside by 2026. Construction is expected to begin in 2022, the company already set aside the funding for the complex. The project would create 170 jobs with average salary of $93,000 plus benefits and support 2,000 construction jobs over a three year period. The company already has 18 facilities in conjunction with petrochemical companies to supply various products and employs 300 workers statewide.

It would be among the largest carbon dioxide capture projects in the world. The company expects the complex will produce more than 750 million standard cubic feet per day of blue hydrogen.

"That's enough energy to drive 3 million cars, this is a big scale project," said Seifi Ghasemi CEO of Air Products. 

The self described "blue" products are produced using hydrocarbons as a feedstock, with the carbon dioxide in the production process captured for permanent sequestration.

A portion of the blue hydrogen will be compressed and supplied to customers by Air Products' Gulf Coast hydrogen pipeline network. The network is the largest hydrogen pipeline system in the world, the company said, stretching more than 700 miles from Galveston Bay to New Orleans.

"You can decarbonize a lot of the chemical and steel plants along this vast part of the United States," Ghasemi said. 

The remainder of the blue hydrogen will be used to make blue ammonia that will be transported around the world and converted back to blue hydrogen for transportation and other markets, the company said. The value of the export for this blue hydrogen would be higher than liquefied natural gas because of the carbon offset. 

The company has already made a final investment decision to move forward with the project and has the money to make it happen. 

"We're not waiting for any banks," he said. 

Air Products was offered $5 million as a performance-based grant from the state to offset plant and pipeline construction costs. The company also looks to have up to 80% property tax abatement over a 10 year stretch, if approved by local taxing entities. It is also participating in the Quality Jobs Program, a cash rebate to companies up to 6% of payroll  for no more than 10 years in addition to state sales and use tax rebates on capital expenditures.

About 95% of the carbon dioxide generated at the manufacturing site where blue hydrogen is created in Burnside will be captured and transported through a pipeline to the carbon capture site 35 miles away. 

The CO2 captured and transported to state lands through the pipeline is then put under pressure which causes the gas to become a liquid which is then injected deep underground into caverns for storage such as under Lake Maurepas. 

Air Products plans to drill wells across Livingston, St. James, St. John the Baptist, Cameron, Tangipahoa parishes spanning 122,455 acres. The state land would include the Maurepas Swamp Wildlife Management Area, Lake Maurepas and Sabine Lake. More than 5 million tons per year of carbon dioxide would be stored permanently underground roughly a mile beneath the surface.

Air Products would pay the state by the acre which totals $6.1 million plus $1.50 per ton of carbon stored to the state which goes into the general fund. 

Louisiana state leaders want to reduce net greenhouse gas emissions up to 50% by 2030 and hit 'net zero' by 2050. Carbon capture technology is a key facet of that plan. 

The carbon capture part of the project would cost several hundred million dollars each and the cost to capture carbon per ton varies between $58 per ton and $232 per ton. The U.S. Department of Energy projected by 2030 carbon capture costs could drop to $30 per ton. There's a $50 per ton tax credit available through the federal government for carbon capture. 

In Louisiana, 61% of the greenhouse gas emissions come from the industrial sector so while other states may begin the decarbonization process tackling transportation or electricity the state is focusing on its petrochemical sector, according to the LSU Center for Energy Studies. 

While consumer vehicles may transition to more electric power, the demand for liquid fuels for aviation, trucks and ships is expected to continue to decades, said Greg Upton, associate research professor at LSU. 

"The key here is those lifecycle carbon emissions, you could theoretically have a world where it is net carbon negative if you were to sequester enough carbon and have zero emitting fuel," Upton said.

Louisiana has attractive geologic formations underground caverns which are used for the carbon capture. 

"This gives us a unique opportunity to be a hub," Upton said. 

Those alternative fuels could be renewable such as hydrogen fueling stations at ports along the Mississippi River to support tugboats. The goal is to decarbonize the whole supply chain. 

Governor John Bel Edwards said that there's more risk for the state not to move forward with carbon capture than there is to disrupt existing wetlands for injection wells. 

"The science here we believe is sound," Edwards said. "We will make absolutely sure that the geologic formations are proper before this moves forward. I think the risk quite frankly is not doing projects of this type in terms of the economy because an energy transition is underway and we're powerless to stop it."

While the state of Louisiana already has the legal framework for carbon capture, there are efforts underway for more federal support.

U.S. Sen. Bill Cassidy, R-Baton Rouge, recently introduced a bill to promote carbon capture. The bill would offer low interest lows for carbon dioxide transportation projects, offer cost-sharing and federal support for commercial storage projects and increase funding to the Environmental Protection Agency to permit carbon capture wells. Grants would also be made to state and local governments to generate demand for products made from the carbon dioxide underground. 

 

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I know little about this technology, but I'm interested.  I've also read articles from environmental groups that blast blue hydrogen, saying it is terrible technology for the environment.

At first blush, it would seem like "carbon capture" should or could be a big help.

The technology for CCSU doesn't appear to be sufficiently advanced at this point for investments at this level but more power to 'em and good luck.  There are many potential benefits if the technology can be refined and scaled, read economic.  Economic may depend upon federal/state tax incentives and investment.  Since climate change is out running any substantive action by countries to change the way they source energy, carbon capture may be our only hope of avoiding the worst of what's coming.  And what is already "baked in" will be horrific for many parts of the world.

Hard greens hate and oppose anything fossil fuel without any seeming regard to how voters would react if their energy bills escalate significantly.  The crux of this argument is how much methane is released into the atmosphere by the supply and use chain of blue hydrogen.  Just so it is clear to the members, blue hydrogen is produced from natural gas feed stock.  Green hydrogen is produced by the electrolysis of water.

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