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8 November 2006 -- Centrica plc announced it has acquired an option to participate in what would be the UK's first complete clean coal power generation project for a total of £7.15 million. The agreement, with Progressive Energy Limited, provides Centrica with an 85 percent interest in development company Coastal Energy Ltd., which will seek full consents for the right to construct a new clean coal power station in Teesside, UK.
If progressed, the project would be the first to combine integrated gasification combined cycle (IGCC) and carbon capture and storage (CCS) capabilities, and would lead to the development of a 'clean coal' power station to supply electricity for British Gas customers, together with a pipeline and storage project to capture the CO2 emissions.
Centrica will obtain a fixed price option to acquire the remaining shares in Coastal Energy at the end of the two-year development phase. Exercising the option would enable Centrica to negotiate an engineering, procurement and construction (EPC) contract, ready for full construction.
Under the same agreement, Centrica will also acquire a 55 percent interest in Coots Limited, a CO2 pipeline company. Subject to further financing, this would provide a full carbon capture and storage solution to dispose of the power station's emissions in the North Sea through agreements with existing producers.
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