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EPA and Texas Railroad Commission Sign Memorandum of Agreement for Permitting Geologic Storage of Carbon Dioxide

LCG, April 29, 2025--Officials from the U.S. Environmental Protection Agency (EPA) and Texas Railroad Commission (RRC) signed a memorandum of agreement (MOA) today outlining the state’s plans to administer programs related to carbon storage wells, known as Class VI wells. The MOA signing is a required step in the RRC’s application to be granted authority to permit Class VI wells in the state of Texas. EPA is currently preparing a proposed approval of RRC’s primacy application.

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Calpine and ExxonMobil Sign CO2 Transportation and Storage Agreement for CCS Project in Texas

LCG, April 24, 2025--Exxon Mobil Corporation (ExxonMobil) announced yesterday an agreement with Calpine Corporation (Calpine) to transport and permanently store up to 2 million metric tons per annum (MTA) of CO2 from Calpine’s Baytown Energy Center, a natural gas-fired facility located near Houston, Texas. This is part of Calpine’s Baytown Carbon Capture and Storage (CCS) Project that is designed to add CCS for the facility’s CO2 emissions. The Calpine facility could then provide a 24/7 supply of low-carbon electricity to the Texas grid plus steam to nearby industrial facilities.

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Industry News

Gemma Power Systems Receives Notice to Proceed on a 1.2-GW Power Project in Texas

LCG, April 8, 2025--Gemma Power Systems (“Gemma”), a wholly owned subsidiary of Argan, Inc. (“Argan”), has received a notice to proceed on its previously announced engineering, procurement and construction (“EPC”) services contract with Sandow Lakes Energy Company, LLC (“SLEC”) for a 1.2-GW power plant in Lee County, Texas. Construction of the natural gas-fired, combined cycle facility is scheduled to commence this summer, with an expected project completion date in 2028.

SLEC announced its plans to build the new electric generating facility earlier this year. The combined cycle facility will be developed and owned by a SLEC subsidiary and will operate within the Electric Reliability Council of Texas (“ERCOT”). The 1,200-MW project is located near a 24-inch tap off the Matterhorn Natural Gas Pipeline, and the new facility will add significant dispatchable generating capacity to the region.

Gemma's CEO stated, “We’re thrilled to move forward with SLEC on this major power project. Their strong development efforts set the stage for success, and we look forward to working together. Expanding power infrastructure is essential to meeting rising energy demands, and our team is dedicated to delivering exceptional results.”

SLEC previously executed an agreement with Siemens Energy to reserve manufacturing slots for two SGT6-9000HL gas turbines to be installed at the new combined cycle facility. The SGT6-9000HL is one of the most technologically advanced gas turbines in the world, featuring high power output, excellent fuel efficiency, and the capability of operating on hydrogen with only minor modifications to the equipment.

The Sandow Lakes project location was formerly the site of a 1950s-era integrated industrial enterprise that included 1,200-MW of coal-fired generating capacity. The legacy coal facilities and industrial facilities are in the process of being partially demolished and repurposed, paving the way for the clean-burning, natural gas-fired facility. Texas State Representative Stan Gerdes, in whose House District the development sits, previously commented, “For the citizens of this region, losing Alcoa after 6 decades of manufacturing was a blow to the entire region. But with the advent of Sandow Lakes, the folks living here have renewed enthusiasm for the area, their families and for the future.”
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