SunGas to Build $2B Green Methanol Facility in Louisiana

Texas-based SunGas Renewables Inc. is building an approximately $2-billion green methanol plant in Central Louisiana, the company said in a news release Wednesday.

SunGas is establishing a wholly owned subsidiary, Beaver Lake Renewable Energy LLC (BLRE), for the facility, which is targeted to generate almost 400,000 metric tons of green methanol per year for marine fuel, the company said.

The BLRE facility, to be built at the former International Paper facility in Rapides Parish, is expected to begin construction in late 2024 with commercial operation starting in 2027, according to the news release. The project will be executed by Denbury Carbon Solutions.

The green methanol produced by BLRE will fuel A.P. Moller-Maersk’s fleet of methanol-powered container vessels, using wood fiber from local, sustainably-managed forests, SunGas said. The methanol will have a negative carbon intensity through the sequestration of nearly a million tons per year of carbon dioxide produced by the project, the company said.

“Using biomass from sustainably managed forestry along with carbon capture allows our project to generate green marine shipping fuel while simultaneously removing carbon from the atmosphere”, SunGas CEO Robert Rigdon said. “This new low-carbon marine fuel facility also helps strengthen communities and create sustainable economies right here in Rapides Parish, Louisiana.”

“As we continue our mission to make a meaningful impact in the energy transition, we look forward to collaborating with all our project partners and the State of Louisiana to construct and operate this important project. This incredible effort happening right here in Pineville will be an innovative and industry-leading low-carbon energy solution that will help fuel a better world”, Rigdon added. 

“A.P. Moller - Maersk is excited to be partnering with SunGas Renewables, which is pioneering a truly large-scale pathway to green methanol with its Beaver Lake Renewable Energy facility”, Maersk Head of Energy Markets Emma Mazhari said.

“This is helping Maersk to deliver valuable services to our customers and is aligned with our aim to reach net zero greenhouse emissions by 2040. Together, as pioneers in the field, SunGas and Maersk are driving a much-needed transition in a heavy pollution industry. We hope that work can be accelerated further in the years to come,” Mazhari added.

In late 2022, SunGas announced a strategic partnership with Denmark-based Maersk, the world’s second-largest container shipping company, to produce green methanol from multiple facilities around the country, the company said. The BLRE project is SunGas Renewables’ first facility to produce green methanol for Maersk.

SunGas said it chose Central Louisiana for the BLRE project due to its “long history of sustainably managed forests, available infrastructure to support the facility, and strong local and state support”.

“As the only state in the Gulf South with a climate action plan, Louisiana is a global leader in the energy transition, and companies like SunGas Renewables have taken notice”, Louisiana Governor John Bel Edwards said. “I applaud SunGas Renewables for pursuing this massive investment that would create quality, high-paying jobs in central Louisiana for our talented workers. If it moves forward, this project will be another milestone in our efforts to grow and diversify our economy. The state will continue to support the company’s efforts to bring it to completion.”

SunGas is a spinout of GTI Energy, specializing in gasification systems that produce tar-free syngas essential for the production of gaseous and liquid biofuels and biochemicals at an industrial scale. The company was incorporated in 2019, according to the company website.

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