New relationships with TC Energy, Mitsubishi Heavy Industries and Kiewit position the project for a final investment decision in early 2024
FOR IMMEDIATE RELEASE
June 28, 2023
GRAND FORKS, N.D. – Minnkota Power Cooperative today announced agreements with TC Energy, Mitsubishi Heavy Industries (MHI), and Kiewit and its affiliates moving Project Tundra into its final stage of project development. The joint effort combines decades of energy industry expertise and strengthens the strategic vision to build one of the world’s largest carbon capture projects in North Dakota.
Under the arrangements, Minnkota will continue to lead project development activities at the Milton R. Young Station power plant, as well as coordination with landowners and community members in the project area near Center, N.D.
“If our organizations are successful in making this historic project a reality, Minnkota will be one of the fastest decarbonizing utilities in the country while maintaining stable electric rates and a reliable, resilient power supply,” said Mac McLennan, Minnkota President and CEO. “By working together, we aim to advance carbon capture technology in a way that can serve as a blueprint for our state, nation and world to meet ambitious decarbonization goals.”
TC Energy will lead commercialization activities, including qualifying for federal 45Q tax credits. Return on project construction and operation costs would be recouped through 45Q, which provides $85 per ton of CO2 permanently stored underground.
In addition, the project participants submitted applications in May for a $350 million grant through the U.S. Department of Energy’s Carbon Capture Demonstration Projects Program and a $150 million loan through the state of North Dakota’s Clean Sustainable Energy Authority (CSEA). The project currently has approval for a $100 million CSEA loan.
“Today’s announcement is a powerful example of private industry and cooperative utilities collaborating to bring scaled change to the energy transition,” said Corey Hessen, Executive Vice President and President, Power and Energy Solutions, at TC Energy. “With Minnkota, Mitsubishi and Kiewit we will combine our respective capabilities to deliver a de-risked commercial and technical solution. This ambitious carbon capture and sequestration project will enable the Young Station to provide power for decades to come…safely, reliably and with a significantly lower emissions profile.”
MHI is the lead technology provider for the project and has successfully deployed more than a dozen commercial CO2 capture projects globally since 1999. MHI is committed to building an innovative solutions ecosystem to realize a carbon-neutral future and achieve its net-zero ambitions within its own operations by 2040. The project will adopt MHI’s CO2 capture technology “Advanced KM CDR Process™” with new solvent “KS-21™.” MHI will collaborate on the CO2 capture facility with Kiewit, who will construct the project.
“Project Tundra represents an important step in the scale up of carbon capture technology, which will play an important role in realizing a carbon neutral society,” said Takajiro Ishikawa, President and CEO of Mitsubishi Heavy Industries America (MHIA), Inc. “Partnerships between policy and business are critical to our success in decarbonizing and we are excited to be part of this group of energy leaders to bring Project Tundra to life.”
“Six years ago, Kiewit and MHIA worked together on the first commercial-scale postcombustion carbon capture project in the U.S.; which was delivered on time and on budget. Today, we have the opportunity to build on that legacy and deliver one of the largest carbon capture projects in the world,” said Dave Claggett, Senior Vice President at Kiewit Energy Group, Inc. “We are proud to be a part of Project Tundra and to support North Dakota’s decarbonization efforts.”
Project Tundra is designed to capture up to four million metric tons of CO2 annually from the coal-based Young Station. The CO2 will be safely and permanently stored more than a mile underground in deep geologic formations. Minnkota currently has the largest fully permitted CO2 storage facility in the United States and is pursuing additional CO2 storage opportunities near the Young Station.
“Our industry-leading team has guided this project through a global pandemic, record inflation and unprecedented supply chain constraints,” McLennan said. “Through those challenges, we have received outstanding support from the community of Center, Oliver County, and the state of North Dakota. None of this would be possible without their commitment and vision.”
Throughout the research and development phases of Project Tundra, both state and federal leaders have played a crucial role in supporting and guiding the project.
“Bringing together the considerable expertise and resources of these industry leaders is a huge momentum boost for the project and bodes well for its future,” North Dakota Gov. Doug Burgum said. “The pursuit of innovation over regulation continues to be a catalyst for capital investment in North Dakota. This project is a shining example of how industries can reduce emissions while investing in baseload generation to preserve reliable, low-cost energy for consumers. It also supports our state’s industries, which provide thousands of good-paying jobs and economic development that generates millions in tax revenue for our state and local governments.”
“Minnkota’s project is leading the nation and world in developing a major carbon capture and storage project on a traditional coal-fired power plant,” said Sen. John Hoeven. “We’ve led the way in reducing SOx, NOx and mercury emissions, and now we’re leading the technology development on carbon capture. We have put in place research and development funding, loan guarantees and the 45Q tax credit so the company can move forward and make sure the next generation of coal-fired power is here today and for future generations.”
“Today’s announcement from Minnkota on Project Tundra is another exciting step toward scaling up carbon capture in North Dakota,” said Sen. Kevin Cramer. “Congratulations to Minnkota, TC Energy, Mitsubishi, Kiewit, and its affiliate team on their partnership and moving to the final stage of development. I look forward to North Dakota’s historic and continued leadership in CCUS technology.”
“North Dakota is at the forefront of carbon capture technology,” said Rep. Kelly Armstrong. “It’s hard to think of a project that’s a better example of this than Project Tundra. I’m glad to see it move forward in our goal of making sure our state’s abundant resources continue to be utilized for generations to come.”
Closing on financing and the notice to move forward with construction of Project Tundra are anticipated in early 2024. The project remains subject to closing on financing and a final investment decision by each of the project entities in the consortium.