The Hunton Energy Corporation announced that it will build a petcoke gasification plant in Freeport, Texas. The plant, Lockwood Project, will be built on 250 acres adjacent to the Dow Oyster Creek Plant in Freeport, Texas.

The feedstock will be petcoke. Hunton Energy has entered into a supply agreement with Valero Energy Corporation to provide the petcoke. Valero has been working to increase the value of it’s petcoke and this agreement realizes that objective. Petcoke is a waste product produced by refineries delayed coker units and has traditionally not been considered a source of revenue.

The plant will convert the syngas to Substitute Natural Gas (SNG) using a methanation process. The SNG produced from the syngas is chemically equal to natural gas and thus is called SNG. The project will capture the CO2 gas, compress it and inject into pipelines for use in Enhanced Oil Recovery (EOR). EOR is the technique of pumping CO2 deep into mature oil formations to increase the production of crude oil. The CO2 remains in the crude oil geological formations.

Dow has entered into an off-take agreement with Hunton Energy to purchase the SNG and some of the steam. The remaining steam will be used to generate electricity.

This project is a win-win for Texas. It will create 1,200 construction jobs and 150 new permanent jobs; it will produce substitute natural gas and electricity with petcoke; it will capture the CO2; and the CO2 will be used to increase oil production in mature oil fields.