I don't know if I like this...FOCUS: ENERGY PROPOSAL
Proposal for new plant at Bethlehem Steel site raises both hopes and doubts
Lackawanna mayor backs plan to convert petroleum coke to gas
By Stephen T. Watson NEWS STAFF REPORTER
Updated: 06/16/08 7:40 AM
A company wants to build a massive plant at the former Bethlehem Steel site that would convert petroleum coke — a waste product of oil refining — into synthetic gas.
Lackawanna Clean Energy says it will spend $1.5 billion to clean up the plant’s dormant coke oven facility and then build its facility, creating 1,500 construction jobs and at least 150 permanent positions at the site.
“One of the objectives of this company is to take brownfields and convert them into useful sites again,” said Ralph D. Miranda, a local project manager for Lackawanna Clean Energy.
If it happens, it would provide a major boost for the area economy.
But there is reason for skepticism. Little is known about Lackawanna Clean Energy, a company set up to manage this visionary project.
The company has hired a public relations firm, but its official Web site is blank.
The company says it has the financing in place to cover the significant capital investment required for its plans, but company officials would not reveal the sources of this support.
And Lackawanna Clean Energy has not yet received the environmental approvals needed for the plant, which would produce carbon dioxide emissions.
“It would be a good idea if you can get a reliable source of petroleum coke in a large enough quantity to make the capital investment worthwhile,” said Harvey G. Stenger Jr., dean of the University at Buffalo engineering school.
The proposal has divided local officials.
Erie County Executive Chris Collins is not endorsing the project because of environmental concerns.
Lackawanna Mayor Norman Polanski Jr., though, is a supporter who touts its economic benefits.
“We haven’t done anything there for 25 years, and this is the opportunity of a lifetime to get somebody in there who will pay taxes and hire locally,” Polanski said.
The company says it plans to build its conversion facility on the sprawling 178-acre parcel along Route 5 that is home to the former Bethlehem Steel coke ovens.
The site is a network of rusting pipe, red-brick buildings in various stages of decay and pockets of overgrown grass.
The waterfront property, with soil as black as coal, sits to the west of the Buffalo Crushed Stone complex and to the east of the new Steel Winds facility.
Lackawanna Clean Energy officials say they would tear down everything on the site and remediate it to the level required by the state Department of Environmental Conservation.
The raw material in their business plan is petroleum coke, a waste product generated in oil refining.
Petroleum coke turns brittle as it cools and looks and feels like coal, said Stenger, the UB engineering dean.
Under the conversion process known as gasification, this petroleum coke is burned at high temperatures and under high pressure, Stenger said. This produces substitute natural gas, with carbon dioxide as a byproduct, and the company would likely pipe the gas into the distribution network for use as home heating fuel.
“The technology is good, but not as well established as gasifying coal,” Stenger said.
Plans filed with the DEC show the company proposes to convert 6,000 tons of petroleum coke into 85 million cubic feet of synthetic natural gas each day, said Megan Gollwitzer, a department spokeswoman.
“That’s very big. That’s a lot of money and that’s a lot of coke,” Stenger said.
Increase in activity
Company officials have been looking at the site for about four years, and they’ve ramped up activity on the proposal over the past year. They focused on the former coke oven property because of the good rail and water access to the site, Miranda said.
The company has invested at least $1 million in hiring staff and conducting engineering work and other research, officials said.
“This isn’t fairy dust. This is something that’s real. They’ve got the experience to do it,” said Earl Wells, president of e3communications and a spokesman for Lackawanna Clean Energy.
Company principal James S. Falsetti is a Lockport native and former Texaco official who has extensive experience in energy-conversion projects. Some of the other Lackawanna Clean Energy officials were involved in the Steel Winds project, but Miranda declined to identify them.
The project has received little notice to date. Officials with the Buffalo Niagara Enterprise business advocacy group, for example, hadn’t heard of the proposal until a reporter contacted the group.
Project has low profile
Lackawanna Clean Energy officials are looking to complete the cleanup and construction by 2012, but hurdles remain.
The company has begun to seek the required environmental approvals from the state, including permits covering air emissions and pollution discharges.
The DEC ruled that the company’s initial emissions permit application was incomplete, and Lackawanna Clean Energy responded last month, Gollwitzer said. The public will have a chance to comment on the project before the agency makes its decision.
Miranda and Wells said the company is waiting for the state to set new standards on allowable levels of carbon dioxide emissions. Those should come later this summer, and New York is coordinating its new regulations with those of nine other states in the Northeast, said Judith Enck, Gov. David A. Paterson’s deputy secretary for the environment.
The company could bury the carbon dioxide under ground, but it’s not clear whether environmental regulators would permit this disposal method, said Holly A. Sinnott, Erie County’s commissioner of environment and planning.
Given the questions over how to handle the carbon dioxide emissions, and because the process of converting petroleum coke to gas is relatively untested, the county can’t endorse the project at this time, Sinnott said.
The project does have the strong support of Polanski, the Lackawanna mayor. He points to the jobs the project would create as well as the property taxes the plant’s owners would pay.
Polanski wrote a letter to Paterson seeking his backing for the proposal.
“The governor is following the progress of this project with great interest, but we need to see more details,” said Morgan Hook, a Paterson spokesman.
Supply is a question
Can this project succeed?
The company must identify a consistent supply of enough petroleum coke, said Stenger, the UB engineering dean. And even if the company finds enough up-front capital, the economic success of the project hinges on the price of coal and natural gas staying high, Stenger said.
Company officials say the project is realistic and financially viable.
As they escorted two visitors around the parcel last week, company officials talked about their proposal in the context of the long history of industrial work on the site.
“It’s our hope to get it going again,” Miranda said.
He's not using money to "redevelop" though... he's using public money to demolish... so technically he within his wordI have to say I'm truly disgusted with Robert Freudenheim. I have met him and spoke with him in the past, and he told me that he doesn't believe in using tax credits/government money to redevelop buildings (like Rocco Termini does), and that he thinks a building should be financed with private money.
Now, parts of his building are being demolished to protect the neighboring homes, and who is paying for it? The city. The tax payers! FUC#ING HYPOCRITE!