moving the goalposts, page-7

Jantimot,

As Poyndexter realises, my tongue was firmly in my cheek by that point – but the suggestion is not daft.

Is it Linc’s business plan to be specialists at producing subterranean syngas – or to be an electricity utility? Clearly the former – building generation plant is merely a means to an end of commercialising the UCG.

What rate can Linc borrow megabucks of project finance at – and how much dilution would be involved in finding the equity contribution of that project finance? Whereas CS Energy can whip up $1.2bn for a 750MW facility at the drop of a hat, comparatively speaking.

The ideal scenario is for Linc to produce their syngas, of a suitable spec for generation, and sell it to a utility who can do what they do best with it. And the proximity of Kogan Creek suggests CS Energy as the best partner if they haven’t hated each other’s guts for the last few years.

The only trouble is that at the moment, said utility isn’t buying. Nor any others. And that’s where the 40MW OCGT demo project comes in – to prove syngas can be supplied for generation in a low BTU turbine trouble free reliable manner. It’s big enough to me meaningful – and be a profit centre in its own right, but small enough to happen with minimum dilution and prevarication.