As energy companies large and small abandon new capital spending projects, one initiative – albeit a relatively small one – remains on the table.
Ashtabula Energy, a Houston-based division of Velocys Inc., plans to build a $200 million refinery that would convert natural gas to liquids in Ashtabula in northeastern Ohio, on the shore of Lake Erie and has applied for a permit to do so by the Ohio Environmental Protection Agency.
The plant, situated on an 80-acre site that once was part of the industrial city’s Union Carbide factory, would convert 2,800 barrels of gas into liquids each day. The Ohio EPA says that if approval is granted, Ashtabula Energy would be permitted dump 1.6 million gallons of waste water each day into the lake, having “minimal impact on the water quality of the lake.”
Pinto Energy proposed building the plant in 2013, but the company was soon bought by Velocys, a British company that moved its operations to Houston at the time to enter the U.S. market. Velocys says the project will mean 400 temporary jobs to build the plant, which should be completed by the end of this year, and result in 30 permanent jobs in Ashtabula.
And the project can grow with demand, according to Guy Dove, chairman of Pinto Energy. “The site we have is actually large enough to build facilities to total 7,000 barrels per day,” he said.
The company says it will use a chemical process called Fischer-Tropsch to convert natural gas into various liquid fuels that are more profitable – for example diesel, which is eight times more expensive than natural gas.