Mississippi Power updates PSC on construction issues at Kemper IGCC

Southern (NYSE:SO) utility Mississippi Power has filed its April report with the Mississippi Public Service Commission (PSC) on progress on the 582-MW Kemper County Integrated Gasification Combined Cycle (IGCC) project.

The facility will gasify lignite coal to generate baseload electricity. It will also capture carbon dioxide (CO2) for enhanced oil recovery. The IGCC project has a $2.88bn cost cap imposed by the PSC, but there are certain exclusions to that cap.

The combined-cycle portion of the facility can already generate electricity with natural gas.

URS Corp. later acquired by AECOM, has been retained to provide Independent Monitoring (IM) services for the PSC at Kemper, the utility noted in the report. The report covers events through April 27.

The engineering work at the site is largely complete. The gasification island design performed by KBR, and the Southern Company Service (SCS) design of the combined cycle island and the balance of plant (BOP) work, was 99% complete during the report period.

Here are a few highlights from the April report:

  • At the end of March, total startup employee staffing was at 279, including Southern Company Services employees.
  • “All major equipment and commodity orders have been placed. Major equipment deliveries are complete. Remaining effort will be focused on final construction and startup needs including procurement of miscellaneous items as identified (scope additions),” according to the report filed with the PSC. Equipment installation is also 99% complete.
  • As for electric transmission, “right of way acquisition and construction is complete for all 11 line segments and all 8 substations,” according to the report.
  • Through April 24, startup progress was 88.4% complete overall (a 1% increase from March 27) versus a planned 100%, the report notes.
  • The adjoining Liberty Mine is operating and stockpiling lignite coal. Total actual spending for the mine development through March, 2016, including mine Allowance for Funds Used during Construction (AFUDC), was unchanged at $232.2M, which is the forecast final cost.
  • The lignite delivery facility is 100% complete. “Coal is being maintained and monitored in silos 2, 5, and 6 for lignite coal runs. In addition, approximately 10,000 tons of coal is being maintained in the dome to support lignite testing this month,” according to the report.
  • Mississippi Power has disclosed that the Securities and Exchange Commission (SEC) is conducting a formal investigation of Southern and Mississippi Power concerning the estimated costs and expected in-service date of the Kemper IGCC Project.  “Southern Company and Mississippi Power Company believe the investigation is focused primarily on periods subsequent to 2010,” the report notes.
  • In regard to project safety, since the beginning of the project, there has been 83 reportable incidents at the site with 38,643,041 man hours worked.
About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.