Summit Power Group said two additional companies will help with financing and construction of the planned 400 MW Texas Clean Energy Project.
Sinopec Engineering Group and The Export-Import Bank of China (Chexim) signed a memorandum of understanding (MOU) with Summit for the TCEP, including a new engineering, procurement and construction (EPC) contract with Sinopec for TCEP’s gasification and chemical block.
Chexim will be the sole financial lender to TCEP, subject to completion of the EPC contract and Chexim’s customary due diligence. The total cost of the project will be more than $2.5 billion, of which $450 million will be provided by a cost-sharing award from the U.S. Department of Energy. The Chexim loan will satisfy all of TCEP’s needs for project debt, the company said in a release.
Under a previously signed EPC contract for the project, Siemens (NYSE: SI) will provide a high-hydrogen combustion turbine, and Selas Fluid Processing Corp., a U.S. affiliate of Linde, will provide key equipment and support Sinopec in the chemical block EPC contract.
TCEP is a coal gasification power/polygen project being developed near Odessa, Texas. The project is expected to capture 90 percent of its carbon dioxide (CO2) and sell a majority of it to Whiting Petroleum Corp. for use in enhanced oil recovery.
Summit also announced that CHS Inc. will purchase all of TCEP’s urea output and make a small equity investment in the project. CHS is a company owned by farmers, ranchers and co-ops across the U.S.
CPS Energy signed a long term-power purchase agreement for the project in June 2011.
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