Port Pascagoula, MS E-Methanol Project

This overview outlines a carbon-negative green / e-methanol production facility located near the Port of Pascagoula, Mississippi – a waterfront , heavy-industrial site with port connectivity and existing industrial infrastructure, utilizing locally sourced wood pellets as renewable feedstock. The project converts biomass into synthesis gas via Sumitomo CHI FW gasification, followed by methanol synthesis using Clariant catalysts.

Mission: Convert sustainably sourced industrial-grade wood pellets into carbon-negative green methanol and related low-carbon products to serve global marine fuel, chemical and industrial decarbonization markets at price points consistent with contracts paid by Maersk and peers.

The facility targets 30–50 million gallons per year (MMgy) of e-methanol (≈ 90,000–150,000 metric tons per annum).

Competitive Advantage: The project benefits from a unique incentive stack, strategic Gulf Coast location, abundant forest waste feedstock, and potential eligibility for hundreds of millions of dollars in tax credits and grants.

Demand for Green Methanol

Global push toward decarbonization along with shifting maritime industry transition towards adoption of green fuels is augmenting the global e-methanol industry. The product’s ability to replace fossil-based methanol while reducing lifecycle emissions makes it a strategic choice for governments and corporations aiming to comply with climate commitments.

Shipping companies are increasingly turning to e-methanol to comply with IMO’s emission reduction goals. Its compatibility with existing engines and infrastructure makes it an attractive alternative to LNG and heavy fuel oil, thereby adding to market growth. For instance, in July 2025, Taiwan based, Yang Ming Marine Transport Corp expanded its methanol-ready fleet by ordering six new containerships.

• Shipping industry transitioning to methanol-burning vessels (Maersk, CMA-CGM, COSCO)

• Green methanol demand projected to grow from 0.2M tons (2024) → 15–20M tons by 2035

• Global supply gap expected: 10M+ tons annually

Why the Gulf Coast

• Largest U.S. petrochemical corridor

• Deep-water ports for global export

• Growing hydrogen & CCS infrastructure

• Proximity to massive Southeastern forest biomass resources

• Strong state/local support for clean energy manufacturing

Location Advantages – Pascagoula, Mississippi

• Deep-water port with break-bulk & bulk handling

• Established forest products supply chain

• Proximity to Gulf shipping lanes

• Competitive labor, land, and utilities

• State and local support for advanced manufacturing & clean fuels

The competitive landscape of the e-methanol market is characterized by a mix of established energy giants, emerging clean tech firms, and strategic partnerships across the hydrogen and carbon capture value chains. Companies involved in green hydrogen production, CO₂ sourcing, and methanol synthesis are forming integrated business models to gain early-mover advantages. Major players are investing in pilot projects, scaling up production capacities, and securing long-term offtake agreements, particularly in maritime and industrial sectors. The top 5 companies in the E-methanol industry including BASF, Liquid Wind, Europe Energy, Methanex, and ABEL Energy held maximum market share in the year 2024.

Competitive Landscape (Gulf Coast Projects)

• Ørsted / Maersk (TX)

• SunGas / C2X (LA)

• Lake Charles Methanol (LA)

• Nacero / Texas Gulf Coast

• Bia Energy / Shreveport (LA)

Combined annual production total = 6,850,000 t/yr (≈6.85 Mt/yr).

None of these projects are yet operational, leaving a temporary supply vacuum our project can enter early.

Key takeaways for investors

• Strategic significance:6.85 Mt/yr is small relative to all global methanol today, but large in the renewable methanol context — these plants could command premium prices and long-term offtake agreements. “Methanex+1”

• Market timing matters: Announced renewable capacity by 2030 is big on paper (tens of Mt), but many projects are pre-FID/FEED — execution risk means early movers with reliable feedstock/offtake and incentives can capture outsized value. “Bioenergy International”

• Offtake opportunities: Marine bunkering hubs and shipping lines are early large buyers — even a few Mt/yr can support important commercial relationships (and premium pricing) while the rest of the market catches up. “Reuters+”

• Deep-water port with break-bulk & bulk handling

• Established forest products supply chain

• Proximity to the Chevron Pascagoula Refinery Carbon Capture and Storage (CCS) project. Pascagoula CCS could safely capture and store CO2 from the Refinery with ambitions to expand to other industries in the area looking to lower their carbon emissions in the future.

• Proximity to Gulf shipping lanes

• Competitive labor, land, and utilities

• State and local support for advanced manufacturing & clean fuels

Process Overview-estimates to be verified through FEED

1. Wood Pellet Supply

   • 700,000 up to 1.5 Mtons/year (sustainably sourced) Final annual volume will based on EPC FEED optimization recommendations.

2. Gasification

   • Oxygen-blown biomass gasifier by Sumitomo CHI FW

3. Gas Cleanup & Conditioning

   • Tar reforming, sulfur removal, syngas adjustment

4. Methanol Synthesis

   • Clariant catalyst systems

5. Product Storage & Export

   • Marine loading and/or rail/truck distribution

Capacity

• 30–50 MMgy

• 90,000–150,000 tpa methanol

Carbon Intensity (CI)

With CCS and woody biomass: CI score can be negative (-20 to -80 gCO₂e/MJ)

Optional carbon capture → carbon-negative profile

Qualifies for highest-value federal credits under 45Z and 45Q

1. Optional additional product lines:

   • Green hydrogen

   • Bio-CO₂

   • Biochar

   • Bio-oil

The regulatory landscape of the e-methanol market is rapidly evolving, shaped by global decarbonization goals and region-specific climate policies. In Europe, directives like RED III and FuelEU Maritime mandate renewable fuel quotas and emissions reductions, directly incentivizing e-methanol adoption in transport and shipping. North America supports the market through mechanisms such as the Inflation Reduction Act’s 45V tax credit for clean hydrogen and California’s Low Carbon Fuel Standard, which recognizes electrofuels like e-methanol.

In Asia-Pacific, countries like China, Japan, and South Korea are integrating e-methanol into national energy strategies, backed by innovation funds and cross-border certification systems. Emerging markets such as Chile, Morocco, and India are aligning with international standards and offering subsidies to scale production, positioning themselves as future exporters under frameworks like the EU’s guarantees of origin.

• Federal Incentives

Incentive Estimated Value

45Z Clean Fuel Production Credit $25–$80M/yr

45Q Carbon Capture Credit $10–$40M/yr

DOE Bioenergy Grants (BETO) $5–$50M

USDA BCAP Biomass Support $10–$14M/yr

BCAP Value=Tonnage Delivered×$20/dry ton for up to two years of

deliveries for eligible materials.

Advanced Energy Manufacturing Credit Additional eligible

• Mississippi State Incentives

Program Benefit

MFLEX Offsets income, franchise, sales/use, & withholding taxes

Clean Energy Initiative 10-year income & franchise tax exemption

Sales/Use Tax Exemption For construction & equipment

Workforce Training Funds $1,500–$4,000 per worker

• California State Incentives

Program Benefit

California Collateral Funding Program CalCAP provides a risk management tool to a participating financial institution (PFI) after a small business borrower (SBB) has applied to a PFI, and the PFI has begun the underwriting process. $20M is the maximum loan size.

• Port Pascagoula / Jackson County Incentives

Incentive Value

10-Year Property Tax Abatement Multi-million reduction

Freeport Inventory Exemption Zero tax on exported stock

Port improvements support Negotiated

Utility infrastructure incentives Case-by-case

📌 Total Potential Incentive Value: $150M–$400M+

(over 10 years not including BCAP Value of $20–$28M over two years, or the CalCAP)

Core Assumptions

• CAPEX:$400 million (all-in EPC + contingency)

• Production: 90,000 / 120,000 / 150,000 tpa

• Methanol pricing:

  • Low: $1,150 / t

  • Base: $1,300 / t

  • Best: $1,500 / t

• OPEX: $115–140 million/year (scale-adjusted)

• Project life: 20+ years

• Model Type: Steady-state, unlevered, illustrative

Gross Revenue

Case Production (tpa) Price ($/t) Annual Revenue ($MM)

Low 90,000 1,150 103.5

Base 120,000 1,300 156.0

Best 150,000 1,500 225.0

Operating Cost Assumptions

Case OPEX ($MM/year) Notes

Low ~115 Lower throughput

Base ~125 Nominal steady state

Best ~140 Higher feedstock & utilities

EBITDA (No Incentives)

Case Revenue ($MM) OPEX ($MM) EBITDA ($MM) EBITDA Margin

Low 103.5 115 (11.5) Negative

Base 156.0 125 31.0 ~20%

Best 225.0 140 85.0 ~38%

This pricing reset intentionally demonstrates why incentives and contracted offtake are critical to downside protection.

Incentive Stack Impact (Illustrative)

45Z Clean Fuel Production Credit

• Estimated benefit: $30–75MM/year, depending on output and CI score

45Q Carbon Capture Credit (Optional)

• Estimated benefit: $34–51MM/year

• CCS capex excluded from base

BCAP (Feedstock-Linked, Early Years Only)

• $10–14MM/year (first two years, if applicable)

EBITDA With Incentives Applied

Base Case (120,000 tpa @ $1,300/t)

Scenario EBITDA ($MM)

No Incentives 31

+ 45Z (Low) ~65

+ 45Z (Mid) ~85

+ 45Z (High) ~105

+ 45Z + 45Q 135–155

Best Case (150,000 tpa @ $1,500/t)

Scenario‍ EBITDA ($MM)‍

No Incentives 85

+ 45Z 130–160

+ 45Z + 45Q 170–210‍

Indicative Unlevered Project Returns

Metric Low Base Base + Incentives Best +Incentives

EBITDA Margin ‍ N/A ~20% ~50–60% ~65–70%

Simple ROI Negative ~8% ~20–25% 30%+

Project IRR <8% ~11–13% ~20–24% 26–30%

Payback N/A ~9–10 yrs ~5–6 yrs ~4 yrs

Key Takeaways

• Unincentivized downside is clearly visible, which lenders expect to see

• 45Z is critical to achieving infrastructure-grade returns at $1,300/t

• Best-case pricing + incentives produces top-quartile IRRs

• Project economics remain robust and financeable with:

  • Contracted offtake

  • Incentive qualification

  • Disciplined EPC execution

Pre-Development & Site Control 6 Months

FEED Engineering 9-12 Months

Permitting & Incentives Parallel (12–18 months)

Final Investment Decision Month 18–24

EPC & Construction 24–30 months

Commissioning & Ramp-up 6 months

Commercial Operations ~4.5–5 years from start

Risk Mitigation

Feedstock Regional pellet oversupply

Methanol Price Long-term offtake floors

Policy Base case works without incentives

Debt Coverage DSCR >1.4x in Base Case

Capital intensity Incentive stacking + federal credit monetization

Technology Proven commercial scale references with Corporate Guarantees

Capital Requirement: $15–25 million

Use of Funds

• FEED Engineering

• Phase 1 site preparation & interconnects

• Environmental & air permits

• Grant and incentive applications

• Commercial offtake development

• Owner’s engineering & project management

Outcome

• Fully de-risked project ready for FID

• Clear incentive stack and contracted revenue base

This Pascagoula-based e-methanol project is positioned to become one of the first commercial-scale, carbon-negative methanol plants in the United States, benefiting from:

• Abundant sustainable biomass

• Proven industrial technology partners

• Strong maritime offtake demand

• Attractive unlevered returns with incentive upside

This project represents a high-growth, tax-advantaged, globally scalable clean-energy investment opportunity.

Recommendation: Proceed with pre-development capitalization, advance FEED and offtake discussions, and position the project for FID within 24 months.