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Velocys’ Bayou Fuels project set to produce negative emission fuels; partnering with Oxy

Velocys, Inc., a wholly owned subsidiary of Velocys plc, signed an agreement with Oxy Low Carbon Ventures, LLC (OLCV), to capture CO2 from Velocys’ planned Bayou Fuels biomass-to-fuels project in Natchez, Mississippi, and securely store it underground in a geologic formation.

OLCV, a wholly owned subsidiary of Occidental, will take, transport and store CO2 captured from the Bayou Fuels facility, when it is completed, enabling the production of transportation fuels that have a net negative carbon intensity—making it the first facility of its kind in the world.

The Bayou Fuels project will take waste woody biomass and convert it into transportation fuels—such as diesel for heavy trucks and sustainable aviation fuel—using Velocys’ proprietary Fischer Tropsch process.

The integrated technical solution designed by Velocys is suited to carbon capture, usage, and storage (CCUS); the CO2 is captured before it enters the atmosphere.

OLCV is uniquely positioned to transport and store the CO2 by leveraging Occidental’s industry leadership in CO2 storage and utilization. This combination of CCUS-ready technology and Occidental’s expertise in storing CO2 enables the Velocys facility to produce net negative carbon-intensity fuels.

Integrating CCUS into the Bayou Fuels biorefinery increases certain targeted revenue streams, such as those derived from the California Low Carbon Fuels Standard, and US 45Q tax credits that incentivize the installation of carbon capture equipment on industrial facilities. This has a meaningful positive impact on returns.

It also helps to de-risk the project and others that follow it. The proposed CCUS solution can be replicated at other sites under development, including Velocys’ UK project which recently submitted a planning application to build Europe’s first commercial scale waste-to-jet fuel facility.

We want this facility, and others that will follow, to be as environmentally friendly as possible and offer attractive opportunities for partnerships with major energy companies. We don’t just want to deal with waste materials and produce cleaner burning fuels—we want the process that produces the clean fuels to be as sustainable as possible as well.

That is why we will be capturing CO2 as a by-product from the gasification process at our Mississippi facility. This will make the facility a net negative emitter of carbon dioxide, which is highly desirable from both an environmental and an investment point of view.

This carbon negative solution could be replicated at other Velocys sites, so we hope our proposed UK facility in Immingham will be able to benefit from this technology, subject to UK Government support for CCUS deployment and the availability of transportation and storage infrastructure in the Humber region.

—Henrik Wareborn, CEO at Velocys

Comments

Engineer-Poet

"capturing CO2 as a by-product from the gasification process...."

In other words, throwing a great deal of the energy and carbon of the feedstock away instead of turning it into products.

HarveyD

NPPs are doing much the same thing with their partly used waste fuel?

Engineer-Poet

But of course, AlzHarvey.  The differences being:

  1. There is nothing resembling a shortage of uranium yet, and
  2. "Greens" won't allow us to build reactors to use the other 99% (and then complain about the "waste" piling up).

SJC

They will use the CO2 for more fuels.

Engineer-Poet

You better hope they do.  Better hope they find some source of energy to turn that CO2 into a product that displaces petroleum, because putting CO2 into the ground while we're still pumping oil is one step forward, two steps back.

SJC

Lots of carbon in biomass, get more H2 from wind and solar,
sell the O2 and or use it for oxygen blown gasification to reduce tars.

gryf

GCC forgot to tell what Oxy Low Carbon Ventures, LLC (OLCV) will do after they take, transport and store CO2 captured from the Bayou Fuels facility.
OLCV will use the CO2 for enhanced oil recovery (EOR). OLCV is also investing in NET Power, LLC (natural gas power system that generates zero atmospheric emissions and includes full carbon dioxide capture), Carbon Engineering (Direct Air Capture of CO2), and others for EOR that will probably put to good use by Occidental Petroleum.

gryf

Of course, EOR is still putting CO2 into the ground and still pumping oil. We can hope that Occidental will use all the additional oil for their chemical business, at least they are pursuing low Carbon technology.

SJC

"The Plains states are seeing strong, steady winds today that are keeping the wind turbines turning, so wholesale power prices have fallen below zero."

With renewable hydrogen, captured CO2 can make fuels. Make a market for carbon, then collecting and storing it makes more economic sense.

Engineer-Poet

The question:

Who is allowed to buy at wholesale rates?  Are there mandatory fees tacked on?  Could you run a business "buying" power when the price hits zero and doing something with it?

HarveyD

Wouldn't it be more logical to reduce/stop CO2 emission at the source, as a priority, by installing more 24/7 REs (with sufficient storage)??

SJC

The amount of renewable energy and alternative transportation is small. We will need hydrocarbon fuels for many decades, it is good to have an alternative when oil supply can not meet demand.

Engineer-Poet

No, AlzHarvey.  In no particular order:

  • There is no such thing as "24/7 REs" that you can just install.  You have to take hydro and geothermal where they are.  The "installables", wind and PV, are not 24/7 and can never be.
  • There is no such thing as "sufficient storage" that's affordable, due to the unreliability of wind and solar.
  • It would be "logical to reduce/stop CO2 emission at the source" but in the case of negative power prices the needs of the grid for frequency control, reactive power and spinning reserve preclude adding any more unreliable generation.  The solution is to prohibit the payment of PTCs or sales of RECs for power sold below a floor price, to get rid of the incentive to generate power that is not needed and perhaps destructive to grid reliability.

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