OPTIMIZED PETROLEUM COKE IGCC COPRODUCTION PLANT

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1 OPTIMIZED PETROLEUM COKE IGCC COPRODUCTION PLANT Phil Amick Global Energy, Inc. Robert Geosits Bechtel Corporation Ron Herbanek Global Energy, Inc. Sheldon Kramer Nexant John Rockey DOE / NETL Samuel Tam - Nexant

2 PRESENTATION OVERVIEW Study Objectives Study methodology Tasks 1.1 through 1.3 Optimization features Plant Performance EPC cost estimates Economic results Conclusions

3 BACKGROUND & OVERVIEW Vision 21 DOE approach to promote fossil fuel energy production in this century Gasification Plant Cost and Performance Optimization Contract DE-AC26-99FT40342 Improve gasification project profitability through optimization of plant performance, capital cost, and O&M costs

4 TASK DEFINITION MATRIX TASKS Baseline (Wabash) Task 1.1 Task 1.2 Task 1.3 Task 1.4 Task 1.5 A & B Task 1.6 Task 1.7 DESCRIPION IGCC RePowering Greenfield IGCC Multi-train IGCP Optimized IGCP Advanced IGCC Optimized IGCC Muti-train IGCC Optimized IGH2 (coal to H2)

5 TASK DEVELOPMENT METHODOLOGY Block Flow (Train) Diagram Availability Calculations A Establish Design Basis Block Flow Diagram Process Modeling Heat Balance Refinement Heat & Material Balances Sized Equipment List Equipment Pricing - Budget Quotes - Factoring [1] B C Value Improvement Practices Process Flow Diagrams Basic Line Sizing/Mat. Spec P&ID Markups [2] Bechtel COMET Model D D Plant Layout Piping MTO Establish Bulk Quantities B EPC Cost Estimate: -Constr. Labor -Bulk Materials -Equipment -Engineering -Indirects -Subcontracts -Spares, Freight C Plant Performance: -Feed Rate -Net Output -Emissions O & M Estimates A Economic Analysis: -ROI -Sensitivities -COE Notes: [1] All critical process equipment costs in Gasification Train, plus ASU (Subcontract) are derived from budget quotations [2] Markups (line size, spec, # trains, eqiup. add/delete) for all lines = 2

6 TASK 1.1 & 1.2 DESIGN BASIS COMPARISON Task 1.1 Wabash Greenfield IGCC Task 1.2 Gulf Coast Refinery IGCP Feedstock Illinois No. 6 Coal Delayed Petroleum Coke Feeds Coal/Coke, tpd (dry basis) 2,260 5,250 Products Export Power, MW Slag, tpd Sulfur, tpd Hydrogen (99%), MMscfd Steam, lb/hr (750 F/700 psig) 0 980,000

7 TASK 1.2 BLOCK FLOW (TRAIN) DIAGRAM

8 TASK 1.3 VALUE IMPROVEMENT PRACTICES PLANT AREA DESCRIPTION Solids Handling Slurry Prep/Feed Gasification LTHR/AGR/SRU Power Block General Simplified solids handling system Removed slurry heaters & spare pumps Employed full slurry quench Removed the post reactor residence vessel Revised Solids Removal System Simplified Claus plant, amine, and sour water system State-of-the-art GE 7FA+e GTG; 210 MW Bechtel s Powerline cost Implemented availability analysis to determine - process configuration - redundancy Optimized plant layouts Reduced O&M costs

9 TASK 1.3 CASE DEVELOPMENT CASE DESCRIPTION GOAL 1.3 Base Case Optimize Task M Minimum Cost Minimize Capital Cost 1.3S Spare Gasification Train Increase Availability 1.3NP Next Plant Improve Economics

10 TASK 1.3 BLOCK FLOW (TRAIN) DIAGRAM TASK 1.3M (MINIMUM COST) IS IDENTICAL EXCEPT GASIFICATION = 1x(1x50%)

11 TASK 1.3S BLOCK FLOW (TRAIN) DIAGRAM TASK 1.3NP IS IDENTICAL EXCEPT GASIFICATION HAS DRY PARTICULATE REMOVAL

12 TASK 1.2 & 1.3 DESIGN BASIS COMPARISON Task 1.3 Task 1.3 Task 1.2 Spare Train Next Plant Feedstock Delayed Petroleum Coke Feeds Coke. Tpd (dry basis) 5,250 5,399 5,417 Products Export Power, MW Slag, tpd Sulfur, tpd Hydrogen (99%, MMscfd Steam, lb/hr (750F/700 psig) 980, , ,000

13 TASK 1.2 & 1.3 DESIGN BASIS COMPARISON Task 1.3 Task 1.3 Task 1.2 Spare Train Next Plant Feedstock Delayed Petroleum Coke Feeds Coke. Tpd (dry basis) 5,250 5,399 5,417 Air Emissions Particulates Nil Nil Nil SO 2, lb/hr NOx as NO 2, lb/hr CO

14 Design and Daily Average Coke Consumptions 0 1,000 2,000 3,000 4,000 5,000 6,000 Coke, TPD Design 5,249 5,399 5,399 5,399 Average 4,635 4,310 3,973 4,814 Subtask Base Case 1.3 Min Cost 1.3 Spare Train

15 Exclusions: Capital Cost Task 1.2 Task 1.3 Base Spare Train Next Plant TIC, MM$ Contingency Permits Licensing fees Risk Premium Agent fees Initial fill of chemicals External Facilities Taxes Warehouse spares Escalation Interest During Construction Owner s Costs (land, O&M equipment, training, & test runs) Assumes a clear and level generic Gulf Coast site.

16 Financial Model Results with a 10% Loan Interest Rate Subtask 1.3 Subtask 1.3 Subtask 1.3 Subtask 1.2 Base Case Spare Train Next Plant Required Power Selling Price for a 12% ROI, $/MW-hr

17 Effect of Power Selling Price with a 10% Loan Interest Rate 25 Return on Investment, % Electricity Price, $/MW-hr Subtask 1.2 Subtask 1.3 Spare Train Subtask 1.3 Next Plant Spare 8% Interest Next 8% Interest

18 Financial Model Results with a 8% Loan Interest Rate Subtask 1.3 Subtask 1.3 Subtask 1.3 Subtask 1.2 Base Case Spare Train Next Plant Required Power Selling Price for a 12% ROI, $/MW-hr Return on Investment with All Prices Indexed to 3.00 $/MMBtu Natural Gas

19 Summary Built on Wabash River experience Conservative design enhancements Realistic cost comparison

20 Conclusions VIP / Optimization Reduced TIC Cost by 20% Improved ROI Competitive with gas under 3.00 $/MMBtu Additional improvements possible

21 Task 1.2 Cogeneration Plant

22 Task 1.3 Cogeneration Plant

23 Acknowledgements DOE / NETL Global Energy Bechtel / Nexant General Electric Praxair UOP

24 Thank you