BP Backs Texas Carbon Capture as Skyonic Gets $128 Million FundsSally Bakewell
BP Plc part-funded an emissions project at a Texas cement plant, betting that plans to turn the gases into chemicals for sale will succeed where traditional carbon-capture proposals have failed.
BP, Cenovus Energy Inc. and other investors in developer Skyonic Corp. pledged a total of $128 million, Skyonic Chief Executive Officer Joe Jones said in Austin, where the company is based. It plans to trap 83,000 metric tons of carbon dioxide a year from Capitol Aggregates Inc.’s plant in San Antonio.
Skyonic expects to profit from global efforts to curb industrial emissions by trapping and “mineralizing” CO2 into byproducts such as hydrochloric acid and baking soda. While countries including the U.S. and Britain have sought to capture carbon from power plants for burial underground, such projects are yet to operate on a commercial scale.
“It signals to the whole world that we have another alternative for carbon capture besides the pipeline-it-and-pump-it-in-the-ground solutions that have failed to take off,” Jones said in a telephone interview.
BP is supporting the venture even after scrapping a carbon-capture project in Scotland. It has developed a “portfolio of investments that could yield valuable innovations in carbon capture and storage, carbon conversion and solutions for carbon markets,” the London-based company said on its website.
The Skyonic funding includes $80 million of loans from Apollo Investment Corp. and Maxus Capital Group LLC, according to Jones. It also won financing from new investors Bluecap Partners, Toyo-Thai Corp. PCL and Energy Technology Ventures. PVS Chemicals Inc., the Detroit-based chemicals maker that will buy the hydrochloric acid, contributed funds too, he said.
Skyonic plans to start production next year. The facility will capture CO2, acid gases and metals from the flue gas and turn them into products for sale that will generate profit at the plant within three years, according to the company.