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CIC Energy signs an agreement with Shell
Allan Seccombe
Posted: Tue, 05 Aug 2008
[miningmx.com] -- CIC Energy has signed an agreement with fuel company Royal Dutch Shell for an option to acquire its coal gasification technology to convert between four and eight million tonnes of coal a year into gas and potential methanol, the company said.
The project could begin first commercial production in 2014, CIC Energy President Greg Kinross said.
CIC Energy has at least 2.3 billion tonnes of coal at Mmamabula in Botswana, where it is planning to erect a 1,200 megawatt power plant and as well as export A-grade thermal coal.
CIC Energy has downscaled the size of its power plant plans from 2,400 MW because South African power utility Eskom and the Botswana Power Corporation could not come to an agreement on assuming risk in the project.
There are three options available to CIC at the coal-to-hydrocarbons (CTH) project, which has just undergone a
feasibility study by Jacobs Engineering Group.
The first option, costed at $4.9bn and which does not include any escalation in inputs, entails the construction of two 44,000 barrels per day (bpd) methanol plants, consuming eight million tonnes of coal a year.
One of the methanol plants would be converted to generate 16,250 bpd of gasoline and the other to make 3,750 tonnes/day of dimethyl-ether (DME), a possible diesel substitute in power plants. The processes would yield 245 tonnes/day of liquefied petroleum gas (LPG).
The second option, costed at $2.6bn and using four million tonnes/year of coal, would have just one 44,000 bpd methanol plant, converted to make 16,250 bpd of gasoline and 245 tonnes/day of LPG.
A third option, at $4.5bn, would have two methanol plants producing 88,000 bpd and a pipeline to transport the product to South Africa, but this is dependent on there being offtake via gas-fired turbines in that country.
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