Shaw, Exelon, NET Power to develop power technology

Baton Rouge, La., June 6, 2012 — The Shaw Group Inc. is teaming up with NET Power and Exelon to develop a new technology for gas-fired power generation that could result in benefits for electricity producers and consumers, energy security and the environment.

The new technology, called NET Power, is based on a high-pressure, supercritical carbon dioxide oxyfuel power cycle, which produces cost-effective electric power with little to no air emissions.

Unlike other power generation technologies that release emissions to the atmosphere or employ expensive, add-on carbon capture systems, the primary byproduct of NET Power is pipeline quality, high-pressure carbon dioxide.

The carbon dioxide can be used for enhanced oil recovery, which can potentially greatly increase reliable reserves of oil in the U.S. and around the world, while sequestering carbon dioxide below ground.

The revenues generated from carbon dioxide sales, added to the revenues from the sale of electricity, can significantly improve the value of the NET Power plant for its owners.

Shaw will acquire a substantial ownership position in NET Power, the developer of the technology, and will have exclusive worldwide rights to engineer, procure and construct NET Power plants.

Exelon will provide and obtain permitting for a small-scale testing site, test and commission the facility, market its output, supply fuel and provide other operations and maintenance support. Exelon will have options for the first full-scale commercial plants when development is complete. The team is working with a leading global manufacturer to design, develop and manufacture an innovative turbine for this new technology.

The initial application of NET Power will be based on a natural gas fueled turbine. Future variants of NET Power are expected to be capable of using coal as the fuel source with existing, commercially available gasifiers. The coal application is expected to yield similarly excellent environmental and cost benefits.

As milestones are completed for the four phases of the project, Shaw will invest up to $50.4 million in cash and in-kind services and will acquire up to 50 percent of NET Power LLC. Phases 1 and 2 involving front end engineering and combustor rig testing are expected to be completed in 2012. Phase 3, expected to be completed in mid-2014, involves the construction and commissioning of a 25 MW small-scale natural gas plant that will capture all emissions and will generate revenue from the sale of electricity and carbon dioxide for enhanced oil recovery. Development of the first full-scale commercial natural gas plant is expected to begin in late 2014 or early 2015.

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