Peabody Energy Acquires Equity Interest in Substitute Natural Gas Producer GreatPoint Energy
25 January 2008
Peabody Energy, the world’s largest private-sector coal company, is taking a minority position in GreatPoint Energy, Inc., a company that is commercializing a proprietary technology to convert coal, petroleum coke and biomass into pipeline-quality natural gas (substitute natural gas, SNG) while enabling carbon capture and storage.
|Overview of the bluegas catalytic coal methanation process. Click to enlarge.|
GreatPoint Energy’s “bluegas” technology uses a single-stage catalytic gasification process to create natural gas that is 99.5% pure methane and can be transported throughout North America utilizing the existing natural gas pipeline infrastructure.
By comparison, syngas resulting from conventional gasification cannot be converted to pipeline quality natural gas without further processing.
By adding a catalyst to the coal gasification system, GreatPoint Energy is able to reduce the operating temperature in the gasifier, while directly promoting the reactions that yield methane, (CH4). Under these mild catalytic conditions, less expensive reactor components are required, pipeline grade methane is produced, and very low cost carbon sources (such as lignites, sub-bituminous coals, tar sands, petroleum coke and petroleum resid) can be used as feedstocks.
Compared to more conventional approaches to gasification and SNG production, the bluegas process eliminates the need for an external water gas shift reactor, a methanation reactor, and air separation plant.
Pressurized steam injected into the methanation reactor fluidizes the mixture of coal or biomass feedstock and the catalyst, ensuring contact between the catalyst and the carbon. The catalyst formulation facilitates three primary chemical reactions (below) between the carbon and the steam on the surface of the coal or biomass and generates a mixture predominately composed of methane and CO2.
Steam carbon: C + H2O → CO + H2
Water-gas shift: CO + H2O → H2 + CO2
Hydro-gasification: 2H2 + C → CH4
The process recovers most of the contaminants in coal as useful by-products and, in addition, roughly half the carbon in the coal is captured as a pure CO2 stream suitable for sequestration.
In addition, GreatPoint Energy’s catalytic coal methanation process eliminates ash removal and slagging problems; reduces maintenance requirements; increases thermal efficiency; and eliminates the air separation plant (a system which accounts for 20% of the capital cost of most gasification systems).
The company is developing the technology for commercial-scale use for power generation, residential and commercial heating and production of chemicals. GreatPoint Energy has completed highly successful testing in a pilot facility in Des Plaines, Ill., and is commencing engineering for the first commercial project.
By October 2007, the company had raised more than $137 million of capital and includes as its investors: venture capital firms Kleiner Perkins Caufield & Byers, Draper Fisher Jurvetson, Advanced Technology Ventures and Khosla Ventures; financial investors such as Sustainable Development Investments, unit of Citi Alternative Investments (a division of Citi); and strategic investors Suncor Energy, Inc., The Dow Chemical Company and The AES Corporation.
As part of the agreement, Peabody and GreatPoint Energy will evaluate the potential for development of joint coal gasification projects using Peabody reserves and land.
Coal products from Peabody Energy fuel approximately 10% of all US electricity generation and more than 2% of worldwide electricity.
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