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GE Energy, Bechtel sign front end engineering design agreement for AEP's second IGCC project

18 August 2006--GE Energy and Bechtel Power have signed their second agreement with American Electric Power (AEP) to move forward with plans for an integrated gasification combined-cycle (IGCC) power plant.

Under the agreement announced Thursday, GE and Bechtel will proceed with the front-end engineering design (FEED) phase for a proposed, 630-MW IGCC plant in Mason County, W. Va. Appalachian Power, an AEP subsidiary, would operate the plant, which would be located next to Appalachian's existing Mountaineer power plant.

In September 2005, GE and Bechtel signed a FEED agreement with AEP, one of the nation's largest electricity generators, for a proposed IGCC project in Meigs County, Ohio. If the two projects receive all of the necessary regulatory approvals, they would be among the first IGCC plants to be built in the United States in the past ten years and the first of this scale.

The FEED process for the West Virginia project is expected to conclude in mid-December 2006. Procurement and construction could start after certain regulatory milestones are achieved.

West Virginia Gov. Joe Manchin cited the proposed Appalachian IGCC project in his 2006 State of the State address, noting: "This is great news for economic development in the state. As one of the first commercial-scale coal gasification projects, this proposed plant will allow us to lead the nation in the development of cleaner coal technology for power generation. Plus, coal gasification offers future opportunities to produce clean liquid fuels and chemical feedstock for other industries."

Edward Lowe, general manager of gasification for GE Energy, called the latest announcement with AEP "another major step forward for cleaner coal technology, which continues to build momentum. Today's IGCC technology can play a significant role for power producers expanding and diversifying their energy portfolios for the 21st century."

"As one of our potential launch customers for the IGCC Reference Plant, AEP has been an important contributor to the plant design process. This early collaboration with potential launch customers results in increased customer value that cannot be delivered through transactional relationships alone," said Lowe.

If awarded the contract for the next phase of the West Virginia project, GE would supply the IGCC technology for the new plant while Bechtel would handle engineering, procurement and construction. GE and Bechtel offer an IGCC Reference Plant - a standard commercial offering for IGCC projects in the United States, via a single point of contact for project developers.




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