A $3.8 billion Lake Charles plant that turns oil refining waste into synthetic natural gas could be derailed by the president's proposed budget, which would cut a controversial Energy Department loan program the project needs for financing.
The Energy Department gave conditional approval to a $2 billion loan to Lake Charles Methanol LLC. Supporters, who include Sen. Bill Cassidy, say the project will create 1,000 construction jobs and 500 permanent positions, and turn petroleum coke into methanol, used to make plastics, paint, and glue among other things. The carbon dioxide produced could be injected underground to boost oil production.
WASHINGTON — The Energy Department said Wednesday it is offering a conditional $2 billion lo…
However, the plant's cutting-edge technology is unproven so banks won't finance it, according to Bloomberg News. The most obvious lender for the project is the Energy Department loan program whose many successes have been overshadowed by a notable failure: a $535 million loan guarantee to Solyndra LLC, a cylindrical solar panel maker that went bankrupt in 2011.
"The debate about whether the government should lend a hand in Lake Charles could become as divisive for Republicans as TransCanada Corp.’s Keystone XL pipeline was for President Barack Obama’s administration. It pits supporting companies, Republican members of Congress and Breitbart against the Tea Party and the Heritage Foundation, which oppose handouts to companies," according to the Bloomberg article.
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