UPDATE 1-Hunton changes Texas IGCC power project plan

(Recasts lead, adds comment from county commissioner)

By Eileen O'Grady

HOUSTON, Nov 6 (Reuters) - Houston-based Hunton Energy has altered its plan to build a large integrated gasification combined cycle (IGCC) power plant near Houston and may instead supply its synthetic gas to a large chemical plant, according to elected officials familiar with the proposal.

When announced earlier this year, the $2.4 billion, 1,200-megawatt Lockwood IGCC project was to be built in Fort Bend County, southwest of Houston and produce electricity from the gasification of petroleum coke, a byproduct of the refining industry, similar to coal.

Now, however, the project may move to adjacent Brazoria County and may supply synthetic gas to Dow Chemical's (DOW.N) Freeport, Texas facility which produces polyurethane, used in foam, adhesives and coatings, sources said.

Brazoria County Commissioner Dude Payne said Hunton filed a request for tax abatement for a large gasification project about two weeks ago. The application indicates Hunton will supply gas to Dow Chemical, Payne said.

Meanwhile, a Fort Bend commissioner said the Lockwood plant likely would not be built there.

A Hunton spokeswoman said a "significant announcement is pending about Hunton Energy's commitment to IGCC." She would not elaborate on Tuesday.

IGCC is viewed as a technology to allow coal and other petroleum-based fuel to be burned to produce electricity while reducing dangerous pollutants and carbon dioxide before they are emitted into the atmosphere.