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transcript
ENERGY, INNOVATION, AND ECONOMIC DEVELOPMENT
The Mesaba Energy Project
Excelsior Energy Inc.Mesaba Energy ProjectProject Update2008 GTC ConferenceOctober 7, 2008
Page 1
Project Energy Project Overview
Status of Efforts
Carbon Management Approach
Page 2
Project Overview
Subject to Confidentiality AgreementPage 3
Mesaba Energy Project Overview
IGCC plant with initial capacity of nominal 600 MW (net) with 2014 in-service dateCommercial, multi-train application of ConocoPhillips E-GasTM Technology for solid fuel gasification; fuel-flexible design accommodates 100% Powder River Basin (PRB) coal, 100% Illinois No. 6, or a blend of PRB and petroleum cokePreferred site on west Iron Range near Taconite, MN2003 Minnesota enabling legislation facilitated IGCC development
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Site Location
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Mesaba Project Key ParametersUtilizes enhanced design of an existing operating IGCC plantMISO transmission interconnection agreement in place to make output deliverable throughout MISO gridMinnesota enabling legislation
Exempt from certificate of need for generation and transmissionExempt from Minnesota law banning new coal generation
Federal incentives:Recipient of U.S. Department of Energy (DOE) $36 million Clean Coal Power Initiative Round II 50% cost-share fundingSpecific authorization for loan guarantee in federal Energy Policy Act of 2005; selected by DOE’s loan guarantee program to submit full application$133.5 million of Section 48A investment tax credits awarded to project by U.S. Treasury Department
Licensing rights to ConocoPhillips E-Gas technology, designed for subbituminous coalAbility to capture 30% of carbon emissions with proven technologies and developed plan for sequestration in North Dakota in conjunction with enhanced oil recovery (EOR)
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Plant Configuration: Well Understood Processes and Equipment
600 MW integrated gasification combined-cycle (IGCC) plant:
2 combustion turbines, 1 steam turbine generator, and 2 heat recovery steam generators
2 gasification trains with full spare gasifier, for high availability
Natural gas pipeline allows plant to provide back-up generation with natural gas when gasification island is unavailable
Licensee of ConocoPhillips E-Gas Technology (coal gasification)—agreement provides for long-term alliance benefits
Selected by the Electric Power Research Institute as the “reference plant” design for fuel-flexible IGCC
Designed to run on 100% subbituminous Powder River Basin coal, Illinois No. 6 coal, and blends of coal and petroleum coke
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Fuel Flexibility and Diversity
95% Pure O2
Bituminous
Sub Bituminous
Petcoke (50%)
Coal
PreparationGasifiers
SyngasCooling
Gas Cleanup
SyngasConditioning Natural Gas
Syngas
GasificationIsland
Combined Cycle Power Island
Combustion Turbines/Generators
Heat Recovery Steam Generators
Steam Turbine/Generator
Steam Condenser
AirSeparation
Unit
Fuel Flexibility Fuel Diversity
Power To The
Grid
The Project can use a wide variety of feedstocks, including high-sulfur Eastern coal, Midwest bituminous coal, Powder River Basin coal, and petroleum coke
Natural gas backup provides added fuel diversity to further increase plant availability
Page 8
Infrastructure and Transmission
Adequate rail, natural gas, and water infrastructure available at site to develop project
Site near Taconite, Minnesota situated strategically with access to two rail lines; options obtained for both preferred and alternative sites
Permit applications include a second 600-MW unit at the same site
Transmission interconnection agreements signed (LGIAs); modest transmission network upgrades required to achieve deliverability throughout MISO
9 miles of double-circuited 345-kV transmission line required for Generator Outlet facilities (serves both units at site)
Baseline studies indicate 80 miles of new 230-kV transmission line needed from Minnesota Power’s Boswell station to its Riverton substation; Excelsior has asked MISO to conduct sensitivity studies to verify baseline conclusions (rapid industrial expansions occurring since baseline conditions established could significantly lessen requirements)
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Site/Route Licensing Activities and Schedule
Remaining Activities and Approvals
DOE preparing final comment and response document for review by EIS cooperating agencies
Final EIS issuance targeted for early January 2009
Administrative Law Judge recommendation to Minnesota Public Utilities Commission (MPUC) regarding adequacy of EIS and preferred Project site anticipated early 2009
MPUC issues final decision anticipated in second quarter 2009
Draft permits issued for public comment shortly after MPUC sitingdecision
Carbon dioxide pipeline permitting slated to begin upon Project’s financial close
Subject to Confidentiality AgreementPage 10
Carbon Capture and Sequestration Plan
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CCS Plan: Approach
Excelsior has filed with regulators a plan for Carbon Capture and Sequestration (“CCS Plan”)
CCS Plan identifies enhanced oil recovery and other sequestration opportunities in the region; based, in part, on work conducted by the EERC as part of PCOR Partnership program
CO2 removal from syngas prior to firing in combustion turbine (no shift conversion required); for subbituminous coal provides approximately 30% overall CO2 captureUses commercially available technology
Amine scrubber, dehydration & compression“Bolt-on” process allows retrofit installation with minimal down time andplant can operate with or without captureEnhanced Oil Recovery (“EOR”)
Transport by pipeline to north-central North Dakota and southwestern Manitoba; pipeline ~400 to 450 miles in length
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Potential CO2 Pipeline Routes: EOR
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Potential CO2 Pipeline Routes: Saline Aquifer
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EERC’s Vision of CCS in a Carbon-Managed Economy
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CCS Plan: Why Excelsior’s Plan Makes Sense
IGCC is the best platform for future carbon capture
Pre-combustion clean-up provides economical advantages to post-combustion scrubbing in conventional coal-fired power plants
Incremental carbon capture approach
30% capture, dehydration and compression is a “bolt-on” system (it does not affect base case plant design)
Builds bridge to 90% capture
CO2 sequestration at EOR site eliminates major risks/liability/development delay associated with geologic saline aquifer
EOR offers revenue to offset costs
Pipeline construction creates opportunity for sequestration of carbon from multiple sites – EERC vision made real
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CCS Plan Synopsis
IGCC with 30% capture and EOR sequestration is the logical framework from which to start building the CCS bridge to future, economically viable, carbon-free power production
Starting at a higher capture level represents too high a cost and technological/integration risk for the first commercial IGCC projects
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An Essential Step to Decarbonized Coal
The Mesaba Energy Project will demonstrate the commercial technologies that are essential to the nation’s transition to low-emission power from coal
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