Developer of coal gasification project in California asks for six-month delay

Citing its recent problems with winning a CO2 off-take contract, Hydrogen Energy California LLC on May 5 asked the California Energy Commission for a six-month suspension of its Application for Certification (AFC) proceeding for the Hydrogen Energy California Project.

As it did in a recent response to a request by environmental groups that the commission terminate this proceeding, the company said that for the past 18 months it has engaged in a sustained effort to consummate a CO2 off-take agreement for the project, which would allow it to advance the review of the AFC. Through November 2014, it had a reasonable expectation that it could consummate a CO2 off-take agreement with California Resources Corp. (CRC), which was formerly known as Occidental of Elk Hills.

“Unfortunately, events completely outside the control of Applicant, have prevented consummating an agreement with CRC,” said the May 5 suspension request. “When it became apparent that CRC was not able to devote sufficient resources and attention to completing negotiation of a CO2 off-take agreement by the end of2014 as it had projected, Applicant stepped up its efforts to identify and enter into discussions with alternative CO2 offtakers. Those efforts are ongoing.

“At this point in time, a completed CO2 off-take agreement does not appear to be imminent. Under these circumstances, Applicant believes that it would be appropriate for the AFC proceeding to be suspended to accurately reflect the current status of the project. Applicant therefore requests that the Committee suspend the AFC proceeding for a period of six months. Applicant believes that this request is reasonable under the circumstances, and notes that suspensions of longer periods of time have been granted for AFCs that have been pending for longer than the Project AFC.”

The project, as proposed, would gasify blends of petroleum coke (25%) and coal (75%) to produce hydrogen to fuel a combustion turbine operating in combined cycle mode. The gasification component would produce 180 million standard cubic feet per day (MMSCFD) of hydrogen to feed a 400 MW (gross), 288 MW (net) plant. The gasification component would also capture approximately 130 MMSCFD of CO2 (or approximately 90% at steady-state operation), which would be transported and used for enhanced oil recovery and sequestration (storage) in the Elk Hills Oil Field Unit. The HECA project would also produce approximately 1 million tons of fertilizer for domestic use.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.