SunGas Renewables weighs green methanol plant for central Louisiana

July 28, 2023
SunGas Renewables selected Pineville, Rapides Parish, La., for potential construction of newly formed subsidiary Beaver Lake Renewable Energy LLC’s first plant for production of green methanol to help decarbonize the marine shipping industry.

Houston-based SunGas Renewables Inc. (SGR) has selected Pineville, Rapides Parish, La., for potential construction of newly formed subsidiary Beaver Lake Renewable Energy LLC’s (BLRE) first plant for production of green methanol to help decarbonize the marine shipping industry.

To involve the repurposing of an existing industrial site shuttered in 2009, the proposed $1.8-billion project would include construction of a plant designed to produce green methanol for marine fuel from a feedstock of regionally sourced biomass—including wood fiber collected from local timber thinning operations—and carbon dioxide (CO2) using SGR’s proprietary SGR System 1000 platform, SGR and the Louisiana Economic Development (LED) said in separate releases.

The project also would be equipped to sequester nearly 1 million tonnes/year (tpy) of CO2 from its operations using carbon solutions from Denbury Inc. to enable production of green methanol with a negative carbon intensity, SGR said.

Denbury, a soon-to-be-subsidiary of ExxonMobil Corp., recently signed agreements to expand its CO2- sequestration portfolio in Louisiana with two separate projects due online between 2026-27, in time to accommodate the BLRE project (OGJ Online, July 13, 2023; June 27, 2023).

As currently planned, the proposed plant would produce 400,000 tpy of renewable, liquid green methanol fuel suitable for marine transportation in ocean-going container ships, all of which will be allocated to Denmark-based A.P. Møller–Mærsk AS to fuel is new and growing fleet of methanol-powered container vessels as part of a preexisting offtake agreement, SGR said.

With front-end engineering and design (FEED) of the BLRE plant scheduled for October 2023, LED said SGR plans to reach final investment decision (FID) on the project in August 2024. If approved, construction would begin in fourth-quarter 2024 for targeted start of commercial operations sometime in 2027, according to BLRE’s website.

Energy transition, workforce

The energy transition-related project is one of many recently selected for development in Louisiana, the only state along the US Gulf Coast—the country’s highest emissions-emitting region—with a climate action plan.

“Louisiana is a global leader in the energy transition, and companies like [SGR] have taken notice,” said Gov. John Bel Edwards upon the project’s late-July unveiling.

SGR said its selection of central Louisiana for the BLRE project results from the state’s history of sustainably managed forests, existing infrastructure to support the plant, and strong local and state support.

To support the project, LED confirmed it has offered a competitive incentives package that includes access to LED FastStart comprehensive workforce development solutions and a $6 million performance-based grant for infrastructure improvements upon SGR meeting investment and employment targets.

In addition to roughly 1,150 construction jobs at peak construction, the BLRE project will create 109 new direct jobs with an average annual salary of more than $78,000, as well an additional 390 new indirect jobs, to deliver 499 total new employment opportunities for central Louisiana, LED said.

Established in 2019 as a subsidiary of GTI Energy’s GTI International Inc., SGR deploys commercial gasification systems—including the SGR System 1000 platform—based on GTI’s pressurized fluidized-bed technology that produce a clean, tar-free syngas for production of renewable, low-carbon products, according to GTI Energy’s website.