Wednesday, May 23, 2012

Sundrop Fuels Moves Forward with Green Gasoline Plant in LA

Sundrop Fuels of Longmont, CO today announced a partnership with technology and engineering company ThyssenKrupp Uhde to develop a "green gasoline" production facility near Alexandria, LA.  The plant was announced in November 2011, but the news today is the formalizing of the working partnership between Sundrop and ThyssenKrupp Uhde.

The plant would create auto fuel, in their words: 
"...using a commercially-proven production path that integrates gasification, gas purification, methanol synthesis and a methanol-to-gasoline (MTG) process. The clean, affordable biofuel is ready for immediate use in today’s combustion engines and will be delivered to the marketplace via the nation’s existing fuels distribution infrastructure."
Basically, they will combine "forest residues and thinnings" as a feedstock with natural gas to create auto fuel.

The choice of the Alexandria location had everything to do with the Haynesville Shale as well as the site's proximity to existing energy industry infrastructure.  The location of the pilot plant is adjacent to a pipeline coming from the Haynesville Shale.  Construction is expected to begin by year end 2012.

The plant effectively is a pilot program to produce around 3,500 barrels per day (around 1.28 million barrels per year).  If all goes as planned, another larger 300 million barrel per year facility would be built in a yet to be determined location.  Ultimately, the company expects to produce approximately one billion gallons per year of green gasoline.

Sundrop is half-owned by Chesapeake Energy, which invested $155 million in the company in mid-2011 as part of its initiative to drive demand for natural gas.

[5/27/12 UPDATE: A highly skeptical take on the Sundrop concept from Chris Helman in Forbes.]

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