GreatPoint Energy

Entirely eliminating the generation of carbon dioxide through the use of coal and gas is not a transitional product nor does it have limited opportunity. Given the aggressive targets of emission reductions any technology that can have a meaningful impact on C02 reduction will be welcomed. The real question will be at what cost? The challenge Great Plains will face is how to make itself attractive from a cost perspective. If we take EU carbon ta... More >>

Entirely eliminating the generation of carbon dioxide through the use of coal and gas is not a transitional product nor does it have limited opportunity. Given the aggressive targets of emission reductions any technology that can have a meaningful impact on C02 reduction will be welcomed. The real question will be at what cost? The challenge Great Plains will face is how to make itself attractive from a cost perspective. If we take EU carbon tax levels as an indication, Great Plains will need to come in at a cost of less than $20 per ton of C02 emissions to make itself relevant. << Less

Yunfei had a very good review on Great Point Energy (found here: http://www.chubbybrain.com/companies/greatpointenergy/reviews/yunfeiy2). <br /> <br />His basic take while there are better technologies out there, Great Point will benefit from being a transitional product. <br /> <br />I actually think that being a transitio... More >>

Yunfei had a very good review on Great Point Energy (found here: http://www.chubbybrain.com/companies/greatpointenergy/reviews/yunfeiy2). <br /> <br />His basic take while there are better technologies out there, Great Point will benefit from being a transitional product. <br /> <br />I actually think that being a transitional technology, and an inferior one at that, is the kiss of death for this company. <br /> <br />Let\'s first look at the US Market, where the company recently announced plans to build a facility. <br /> <br />1. The US will not be a market that the company will do well in. This is because the company\'s technology still emits C02. With the coal industry trying to improve its image, US energy companies are not going to want to invest in a technology that still emits CO2. To an increasingly critical public audience, this would be akin to Ford trying to claim its helping the environment by improving gas mileage by a few MPGs. Nice attempt, but not exactly what the public is demanding. <br /> <br />2. Yunfei suggests that company\'s will want to invest in this technology because it provides low-cost energy. Its true that Great Point will produce energy in a low-cost manner, but the initial capital investments are significantly high. With an energy industry currently hurting due to low energy prices (US Energy company stocks are down 60% compared to the overall markets decline of 30%), these companies do not have the capability to throw money at a technology that won\'t address the problem (dirty energy and bad PR). <br /> <br />Bottom Line, because Great Point still emits C02, it will have a very difficult time getting much traction in the US. <br /> <br />But internationally, the picture is slightly different. In September, the company announced two deals for major projects in China. <br /> <br />Developing markets like China represent better opportunities than the US. This is because these countries have lower restrictions on environmental guidelines, plus, as it is in China, energy companies pollute so much, than any little bit helps. <br /> <br />But I see this opportunity as limiting. China for example, has made major strides to clean its air quality, something that Great Points Technology will only partially help. The company may receive short-term success, but in the long-run, companies and governments regardless of market strength, will look to better, more effective technologies in the long-run. << Less

Great Point Energy develops a catalytic process known as hydromethanation, which could convert coal, petroleum and biomass directly into low cost, "clean", pipeline quality natural gas. Although it is not a real "clean" energy (as it gives out carbon dioxide), yet I still believe that the investment will be profitable due to the one crucial factor: low costs. Actually the costs of bluegas manufacturing process has been lowered... More >>

Great Point Energy develops a catalytic process known as hydromethanation, which could convert coal, petroleum and biomass directly into low cost, "clean", pipeline quality natural gas. Although it is not a real "clean" energy (as it gives out carbon dioxide), yet I still believe that the investment will be profitable due to the one crucial factor: low costs. Actually the costs of bluegas manufacturing process has been lowered to such an extent that even Chinese company (Datang Huayin Electric power) has signed an agreement with GPE for building two coal gasification facilities in Guangzhou province and inner Mongolia which amount to a total number of $3 billion investments. In addition the company also discloses their plans to build a several hundred billion dollar coal gasification facility in the US. What drives a company to procure such multi-million projects without a cutting edge technology:<br /> <br /> 1. Low costs good quality gas, this is how it will work in large developing countries like China with a high storage of coal, Americans might not like this because it is not ultimately "clean" and it will definitely be replaced by green energy like solar or bio-fuels someday, however this doesn\'t prevent those less developed countries who don\'t have enough money or scientific approaches to do those cutting edge research to realize their environmental protection. Coal gasification enables them to produce a "clean" high grade natural gas with a cost that is significantly lower( according to the company website) than current price of new drilled natural gas and imported liquefied natural gas.<br /> <br /> 2. Accessibility and price of raw materials, I have to admit that it is coal which makes this technology attractive, nobody is going to leave any chance to make profits on this easy accessible and cheap energy source before it is die out (either due to energy revolution or human consumption), thus in this interim while green technology is not matured enough for mass production and the world calls loudly for alternative energy, the gasification of coal could be served as an expedient measure for a temporary use. After all if we are not for the environmental benefits then for the price.<br /> <br /> 3. Less competitor, since the technology is doomed to be replaced therefore few companies would be willing to make investment at such a time (risks are high) to find such a catalyst which cannot secure them a long term profits (GPE has dedicated to coal gasification since it was founded in 2004). Therefore oil and gas giants like GE and Mistubish will probably follow the routine gasification procedure (with a comparatively high cost) and research on the future generation of energy like solar and bio fuels. At least so far they didn\'t introduce any catalyst improvement to their original processes.<br /> <br /> In general, I believe it is an excellent opportunity for Great Point Energy to expand their products and facilities all over the world, as a blank period between fossil fuels and green energy as well as taking advantage of their easy getting raw materials--coal while the entire world\'s attention has been drawn to develop those revolutionary energy source, I think the company could be profitable with its low costs before the incoming of green technology age.<br /> << Less