The Saskatchewan government has revived the idea of building a clean-coal power plant.

The announcement comes one day after the federal government gave the province nearly $250 million to put toward carbon capture.

The province says it will rebuild and re-power a coal-fired power generator near Estevan, Sask., over the next seven years at a cost of $1.4 billion.

The province says the project will produce 100 megawatts for SaskPower while reducing the public utility's emissions by one million tonnes annually.

The carbon dioxide captured by the project will be pumped into the ground to recover oil.

SaskPower will put up $758 million for the project.

An earlier plan to build a 300-megawatt clean-coal facility was shelved by the previous provincial government because of its $3.8-billion price tag.