8th Nov 2006 07:05
Centrica plc today announced it has acquired an option to participate in whatwould be the UK's first complete clean coal power generation project for a totalof £7.15 million. The agreement, with Progressive Energy Limited, providesCentrica with an 85 per cent interest in development company Coastal EnergyLimited, which will seek full consents for the right to construct a new cleancoal power station in Teesside, UK. If progressed, the project would be the first to combine Integrated GasificationCombined Cycle (IGCC) and Carbon Capture and Storage (CCS) capabilities, andwould lead to the development of a 'clean coal' power station to supplyelectricity for British Gas customers, together with a pipeline and storageproject to capture the CO2 emissions. Centrica will obtain a fixed price option to acquire the remaining shares inCoastal Energy at the end of the two year development phase. Exercising theoption would enable Centrica to negotiate an engineering, procurement andconstruction (EPC) contract, ready for full construction. Under the same agreement, Centrica will also acquire a 55 per cent interest inCoots Limited, a CO2 pipeline company. Subject to further financing, this wouldprovide a full carbon capture and storage solution to dispose of the powerstation's emissions in the North Sea through agreements with existing producers. Sam Laidlaw, Chief Executive of Centrica, said: "This landmark agreement givesCentrica the option to take advantage of the environmental and economic benefitsoffered by emerging clean coal technology and could lead to the development ofthe UK's first complete clean coal plant." "It offers the potential to increase the diversity of our power generation,while underpinning our commitment to source low carbon and competitively pricedelectricity for our British Gas customers." Centrica operates the UK's largest fleet of gas fired power stations, inaddition to its renewable generation capacity, and is also constructing an 885MWgas fired plant at Langage, Devon. From October 2007, it will be the largestcustomer of Drax power station through a 5£ year power purchase agreement linkedto coal prices. It also has a long term tolling agreement with Spalding powerstation and a portfolio of power purchase contracts. \* TEnquiries:Centrica Media Relations: 01753 494085Centrica Investor Relations: 01753 494900\* T Note to editors: 1/ Integrated Gasification Combined Cycle (IGCC) is an emerging technology whichoffers potentially lower running costs than gas-fired generation, withcomparable emissions and performance outputs. IGCC uses the latest combinedcycle technology and is environmentally superior to other types of solid fuelgeneration, enabling capture of over 80% of CO2 emissions. IGCC plants can alsorun on natural gas or operate 'bi-fuel'. Copyright Business Wire 2006Related Shares:
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