October 30, 2008 at 12:11 pm #3350
No ‘business case’ for mixing fuel oil-petroleum coke to revitalize plant: NB Power
Module body Wed Oct 29,2008 12:41 PM
NEW.BRUNSWICK (CBC) – NB Power is abandoning its plan to completely convert its largest generating station to burn a mixture of heavy fuel oil and petroleum coke after the corporation determined it was not saving enough money.
Coleson Cove is the largest fossil fuel-burning power plant east of Ontario, but it rarely operates because its oil-fired boilers are too expensive to run.
Darrell Bishop, executive vice-president of strategic planning at NB Power, said the utility has given up the idea of using petroleum coke to fix that. “The business case doesn’t suggest we’ll be moving there rapidly,” Bishop said.
Last year, Bishop hosted an open house in Saint John where he explained NB Power’s hope to revitalize Coleson Cove by spending $120 million to convert the station’s three generators to burn cheap petroleum coke with its traditional heavy fuel oil.
“There’s every potential of saving up to $50 [million] to $70 million should we convert all three units at the plant and that should equate to a five per cent saving in rates,” he said at the time.
But after experimenting with the new fuel mixture in one of the three boilers, NB Power now said it makes no sense to switch the other two, even though there are no other alternatives for them.
“The other two [boilers], it is not clear what we will do with the other two,” he said.
David Hay, NB Power’s president and chief executive officer, said three years ago that petroleum coke, also known as refinery bottoms, was the plant’s best hope because of its low price. But the fuel emits so much more greenhouse gas emissions than other fuels that NB Power decided new federal climate change rules made conversion a dead end.
Gordon Dalzell, a Saint John-area clean air activist, opposed the big conversion and applauds news it has been scrapped. “They might as well shut it down and put it up for sale because who the hell needs it?” Dalzell said. “It’s kind of a good news story from a greenhouse gas perspective and a local air quality perspective.”
News that the petroleum-coke experiment is being abandoned follows an upbeat message from the corporation earlier in the year. In June, Francis McGuire, chair of NB Power, said in published reports that burning petroleum coke was saving 30 per cent of its fuel costs at the station.
Coleson Cove underwent a massive $747-million upgrade several years ago, allowing it to burn Orimulsion. But when the fuel deal with the Venezuelan state-owned oil company was botched, it left the generator at the mercy of the unpredictable world oil markets.
Coleson Cove has been sitting idle or working at a relatively low capacity for extended periods of time as NB Power has found it cheaper to import electricity from the United States than use the 1,000-megawatt generator outside of Saint John. The utility had even considered expanding the petroleum coke project to the Dalhousie Generating Station to give it greater viability after its Orimulsion contract expires in 2010.
The power corporation received permission from the Department of Environment in April 2007 to run a one-year trial of burning petroleum coke. The utility did not start the test immediately, so there are no figures yet on the environmental impact of mixing fuel oil with petroleum coke.
October 30, 2008 at 12:14 pm #6492
Here is update on NB’s Coleson Cove plant that was converted burn mixture of Petcoke-Heavy Oil mixture after a massive $747 million conversion for Orimulsion was botched by Venezuela.
Seems to be another casualty of the liberal US politicians rush to embrace a Europe climate change concept whose motive has been proven false (ie Man is unimportant in scheme things), failed miserably to meet goals (none 18 signature countries Kyoto met any goals) & greatly damaged the global environment by forcing all pipes & smokestacks plants into undeveloped countries without ANY concern or monitoring on emissions…..great move dummies.
The NB claim now is that the mixture will save enough money, but the June upbeat report showed the project was saving 30% of its fuel cost vs Oil. So…..the blame has to fall on the expected Federal Climate Change rules eliminates these profits & makes the conversion another dead end due to higher emissions generated compared to other fuels.
The other part of the blame would fall to the market overpricing both coal & petcoke to keep up with the speculated driven price of crude & fuel oil products that were not supported by either fundamentals or demand in the market. Since coal & petcoke tend to be priced at 6 months trenches – it is likely they will continue to drive a lot of alternate fuel switching & demand destruction before the price drops inline with drops already seen in diesel/Fuel Oil & Natural Gas markets this quarter.
October 31, 2008 at 10:51 am #6489
Here are some followup comments by contacts on this article:
– Some plant people involved with petcoke trial say this article is fiction & they are following the freight & petcoke markets. The news source is liberal press that tends support environmental viewpoint & politics against project.
<Since there are direct quotes from lot NB executives – I suspect the truth is somewhere between views>
-The cancelation of this project will dump more than 500,000 tons back into the petcoke market if true.
-The trial permit was originally set June 2007 but some delays getting started so end date 2008 has slid to March 2009. This means if project wasn’t cancled a new permit would have to be put in place.
-The trial of blending HFO & Petcoke has probably lost lot of economics due to BIG drop in Crude/Diesel/Fuel Oil recently….which has yet to happen in coal/petcoke markets. The price of resid is somewhere in $50/Bbl range now while petcoke is still hanging in the +$100/ton due to market lags which would make economic justification hard to sell.
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