We pushed very hard to make this new EfW (Energy-from-Waste) technology work and I would like to thank the team who worked so diligently. We appreciate the hard work of our employees and contractors at the site, and certainly understand their disappointment in this decision. We are also disappointed with the outcome. – Seifi Ghasemi, chairman, president and CEO of Air Products (press release, April 4, 2016)
A major company most of us may never have heard of has just indirectly offered, through its own hard loss, the deliverance of Barbados from the clutches of the Cahill Energy gasification project.
The cost to Air Products, a US-registered, publicly traded company on the New York Stock Exchange, will be around US$1 billion, a full ten per cent of its recent annual revenue.
This company, which has been in the industrial gases business for 75 years, was recently ranked No. 284 on the Fortune 500 list. It has 20 000 employees in 50 countries, and the Teesside project was its flagship new technology venture. And it could not make gasification work, despite its best efforts.
Why should any investors think somebody else could make it work here?
It didn’t happen overnight.
Last November, Air Products shut down work on the project, the second of two identical plasma gasification projects, both using gasifiers supplied by Alter NRG, the same company Cahill Energy said it would use for the Barbados project.
It was said to be a “temporary suspension” to give the company a chance to focus on the first one, called TV1. The PR spin contained the following paragraph: “As with many ground breaking projects, improvements are identified as construction advances and new solutions put in place. This is the case for our first renewable energy facility currently being built (TV1). The learnings we are making here will be applicable to our second plant.”
Like the awkward phrasing, it seemed clear that something was wrong. And less than six months later, the whole thing was shut down. The “learnings” they were making at the first plant proved insufficient for the re-starting of the second.
The hopeful phrasing of the November press release was replaced by the more terse, bald statement regarding the “challenges” Air Products faced in the Tees’ Valley. The press release quoted at the start of this column summarized it this way:
“Testing and analysis completed during the company’s fiscal second quarter indicated that additional design and operational challenges would require significant time and cost to rectify. Consequently, the Board of Directors has decided that it is no longer in the best interest of the company and its shareholders to continue the Tees Valley projects.…Exiting the EfW business will allow the company to direct its resources to its core business of industrial gases.”
Now, I ask you, in light of the Air Products failure, who is going to invest in the Barbados gasification plant? Especially when other studies and experiences have shown that municipal waste is not the appropriate fuel for a plasma gasifier?
I don’t expect any mea culpa from the Dolittle administration over its Cahill caper. It will probably just never be spoken about again. But I am sleeping better at night knowing that, thanks to the repudiation of gasification technology by one the most experienced industrial gases firms on the planet, the Cahill Energy project will never get off the drawing board in Barbados.
The unsuitability of the technology for energy-from-waste plants should also provide a way for the next non-Dolittle administration to have the contract voided, or whatever they call it.
I would say “gasified.”
Patrick Hoyos is a journalist and publisher specialising in business. Email: [email protected]
