Dow Chemical Signs Natural Gas Pact with GreatPoint
GreatPoint Energy, Inc. the leading developer of proprietary hydromethanation technology to convert coal, petroleum coke, and biomass into clean natural gas while enabling the capture and sequestration of CO2, and The Dow Chemical Company have signed an agreement giving Dow the option to purchase natural gas from GreatPoint Energy-developed facilities.
This agreement further builds on the relationship between the two companies. In 2007, Dow led GreatPoint Energy’s $103 million equity financing and, previously, the companies entered into a technology collaboration under which Dow provided support to and validated the results from GreatPoint Energy’s pilot plant testing campaign. Dow is one of the country’s largest industrial users of natural gas and has over 30 years of gasification experience, having developed its own gasification technology, known as E-gas, and extensive chemical industry processing and technology scale-up experience.
If Dow decides in its discretion to enter into the long-term natural gas purchase and sale agreement, GreatPoint Energy will provide the company with a portion of the natural gas from its first three projects under development in North America. The contract projects a 15-year contract term with the pricing arrangement based on cost factors determined by both companies.
Hydromethanation is a catalytic process that does not rely on combustion and therefore does not produce the nitrogen oxide, sulfur oxide, and particulate emissions typically associated with the burning of carbon feedstock. Instead, the process captures nearly all of the impurities found in coal, petroleum coke, and biomass and converts them into valuable chemical-grade byproducts, while allowing for the capture and sequestration of carbon dioxide.
“We view Dow as the technical leader in the development and scale-up of catalytic chemical processes and we are extremely pleased to have them as an investor and potential purchaser of natural gas from our facilities,” said GreatPoint Energy Chief Executive Officer Andrew Perlman. “This potential gas agreement will also enable us to move forward with the development of large-scale facilities in North America.”
“As one of the largest industrial users of natural gas, Dow is highly committed to finding reliable, competitive sources of clean energy,” said Rich Wells, vice president of Energy for Dow. “As we continue to evaluate future natural gas supplies, we are pleased to be working with GreatPoint Energy in developing an alternative approach to natural gas production which we believe will be highly attractive.”