(The Center Square) – Fuels manufacturer C2X, a subsidiary of shipping giant A.P. Moller Group, has signed a long-term deal with Microsoft for carbon removal credits generated at a bio-methanol plant that would be built at the site of a shuttered paper mill in central Louisiana.
C2X is developing the Beaver Lake bio-methanol production project near Pineville in Rapides Parish at the site of the former International Paper mill, which closed in 2009.
The $2.4 billion plant, according to Houston-based C2X, is being designed to convert locally sourced forestry thinnings, treetops and sawmill residues into bio-methanol for consumption by global and U.S. customers in the shipping, aviation, chemicals and industrial sectors, with commercial operations expected to begin in 2029.
“The Beaver Lake project combines the benefits of bio-methanol production for customers in hard-to-abate sectors with permanent carbon removals,” said Brian Davis, CEO of C2X.
Under the agreement, Beaver Lake will deliver carbon removal units, each representing one metric ton of carbon dioxide removed from the atmosphere and stored in secure geologic formations in Louisiana, which Microsoft will use to meet its carbon negative goals.
The Beaver Lake project will deliver 3.6 million removal units to Microsoft over a 12-year period, according to C2X. Microsoft plans to be carbon negative by 2030. Through its internal carbon fee funds, the tech giant reports it has purchased more than 30 billion kilowatt-hours of green power and reduced emissions by 20 million metric tons of carbon dioxide.
Phillip Goodman, director of carbon removal portfolio at Microsoft, said the Beaver Lake project provides an opportunity for large-scale carbon removal and also drives broader decarbonization initiatives through the production of green methanol.
C2X expects more than 1,150 construction jobs along with more than 600 direct and indirect jobs.
The Beaver Lake project is the first of several green methanol production facilities planned by C2X. In 2023, the company signed a framework agreement with the Egyptian government for a potential facility near the Suez Canal for the production of up to 1 million tons of green methanol annually.
C2X is majority owned by A.P. Moller Group, parent company of Maersk, the world’s second largest container shipping company. ENEOS, Japan’s largest integrated energy company, is a minority shareholder in the company.
Buck Vandestern, executive director of the Louisiana Forestry Association, said the Beaver Lake project could help replace jobs lost following the closure of three of the state’s paper mills during the last two decades. In April, the International Paper Co mill shut down in Campti in Natchitoches Parish, where 481 workers lost their jobs.
“We recognize the great potential in Louisiana to expand the forestry industry’s base,” said Vandestern. “We have thousands of landowners who have done an excellent job growing trees, to the point now that we’re growing 70% more wood than what we’re taking out of the forest. And this also creates some challenges in keeping our forests healthy.”
Vandestern said that Drax, a U.K.-based firm seeing to reduce its greenhouse footprint, imports wood pellets processed by Morehouse BioEnergy at the former Bastrop paper mill. These pellets are used to generate electricity at a plant in North Yorkshire, England.
“A focus today is on the energy-related industries, where they’re configuring the molecules of wood into different compounds that can be used in the transportation, the aviation, and the shipping industries,” said Vandestern.
C2X executives have said a final investment decision on the Beaver Lake project will be made in the second half of 2026.