Summit Power Group say cost-cutting efforts for a clean-coal plant should be able to save hundreds of millions of dollars of the long-delayed project.

The officials, in a closed-door meeting with city officials this week, said plummeting oil prices in the Permian Basin could relieve the labor market enough to reduce what had been prohibitive costs.

Julio Friedman, the deputy assistant secretary for clean coal at the Department of Energy, also spoke during the meeting about his confidence that the Texas Clean Energy Project, or TCEP, project will materialize.

“Due to the fact that the price of oil has been dropping, some of the major construction companies and engineering firms are a little more amenable to giving out cost estimates for labor and construction costs, and lower costs,” said Mike George, CEO of the Odessa Chamber of Commerce and one of the attendees at the meeting, held Wednesday at the Atkins, Hollmann, Jones, Peacock, Lewis and Lyon law firm.

Summit Power Group plans now to use a new and less-costly combustion turbine made by Siemens and replace two planned gasifiers with one larger gasifer, according to Laura Miller, the former Dallas mayor who is project director of the TCEP in Texas. That would save “a couple hundred million dollars,” Miller said.

The developer also expects a price drop of commodities such as steel and cement.

Summit officials say they have to rein in costs of the project, which rose from an initial proposal of $2.2 billion to about $3.5 billion last year. Their target is $2.5 billion or below.

“We’ve been pretty aggressive about telling all of the lead contractors that we have to reduce the price,” Miller said.

Plans call for construction of the TCEP at a 600-acre site about 15 miles outside of Odessa near Penwell. The 400 megawatt plant would capture 90 percent of the CO2 it produces burning coal and sell that to the oil companies for enhanced recovery operations.

The project’s other key products would be urea and electric power.

Miller said the redesign should not change the production or the amount of employees the plant would require: an estimated 2,000 workers to build the plant and 150 full-time workers to permanently staff the facility.

In October, Summit reached a new agreement with CPS Energy of San Antonio to sell the utility electricity after a previous agreement dissolved. The company also announced a new CEO that month, Jason Crew, who anticipated “rapid closure” of the project after two recent deals.

The first was a financing pledge from China Huanqiu Contracting and Engineering Corporation (HQC). HQC is now the lead partner of the project, performing what is known as a front end engineering and design study, or FEED, with the cost ceiling in mind. This FEED study is the third in the project’s history.

The second deal called for Summit to collaborate with Huaneng’s GreenGen, China’s cleanest operating coal-based plant and one that does gasification and plans to add carbon capture, in planning and commissioning the TCEP.

Summit’s most recent target date to close financing of the project is April of 2015, with construction beginning later that year and ramping up through 2016.

But they expect to have a new cost-estimate for the project by mid-February, Miller said

“All together,” Miller said. “We should be able to reach our goal.”