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HTC applying process to coal, gas-fired plants

Technology originally developed at University of Regina was for use in oil-recovery projects

Globe and Mail: Shawn McCarthy - June 12, 2009

http://www.theglobeandmail.com/report-on-business/htc-applying-process-to-coal-gas-fired-plants/article1180709/

Ottawa - HTC Purenergy Inc.'s patented, amine-solvent technology emerged more a decade ago from the University of Regina labs, where engineers were working on ways to produce low-cost carbon dioxide for use in enhanced oil recovery projects for North America's aging oil fields.

Now, HTC is partnering with some of the world's largest power-plant construction companies to include its carbon-capture technology in new coal-fired and natural-gas plants around the world.

The tiny firm is still headquartered on the university campus, and now trades on the TSX Venture Exchange. Last year, it signed an exclusive licensing agreement with South Korea's Doosan Industrial Co. Ltd., which hopes to build at least 600 clean-coal power plants using HTC technology over the next 25 years.

It has also partnered with U.S. giant Bechtel Group to apply the carbon-capture system to natural-gas fired power and industrial plants.

But it is the drive for “clean coal” that is the alchemist's dream of the 21st century.

Power plants account for 78 per cent of greenhouse gas emissions from stationary sources – that is, not including cars, trucks and airplanes – and coal is the cheapest, most plentiful and dirtiest fuel for power.

HTC chairman Lionel Kambeitz said global engineering firms expect to see the construction of some 5,000 coal-burning power plants over the next 25 years, and 60 per cent of them would include carbon capture and storage.

“Our objective is that, with the quality of the partner we have, we certainly would like to provide our technology on 20 per cent of the plants that are going to be built out there,” he said.

HTC Purenergy is among the companies forcing a reconsideration of capturing carbon from power plants and other industrial processes.

Until recently, most experts believed that the best approach would be to gasify the fossil fuel source – coal, say – and separate the CO2 before combustion.

But the capital costs of building an Integrated Gasification Combine Cycle (IGCC) plant are prohibitive, while HTC Purenergy and its giant competitors, like Fluor Corp. and Alstom SA, have driven down costs of post-combustion capture using ammonia-based solvents.

The key is how much energy is required to capture the CO2. HTC now promises its design uses only one tonne of steam for every tonne of CO2 captured, compared to 1.5-tonnes of steam for its competitors.

And Mr. Kambeitz said HTC expects to reduce the energy consumption of its process by 80 per cent in the coming years.

Analyst Khurram Malik, of Jacob and Company Securities Inc. in Toronto, says HTC Purenergy has established itself as the low-cost design through its super-efficient heating capture process and its designer solvents.

(Jacob Securities manages two funds that owns shares in HTC.)

He estimates the cost of capturing carbon from power plants could be as low as $20 to $40 per tonne – significantly lower than most published estimates – with HTC at the low end of the range.

And companies could recoup that cost by selling the CO2 to oil producers that use it to enhance recovery from declining fields.

“These are numbers that make it much more palatable [to build CCS plants] but they are numbers that are not in the general consciousness,” said Mr. Malik.

“If you attach it to a robust [enhanced-oi-recovery] project, you go cash positive from day one.

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