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The Coal Liquification Initiative November 4, 2006

Posted by federalist in Energy.

Dave Neeleman claims a very appealing energy intiative: Coal liquification.  At a time when ethanol initiatives have driven up the price of corn so much that it threatens our domestic food supply, technologies and infrastructure to exploit our continent’s massive coal reserves seem like an increasingly obvious solution to foreign energy supply problems.

Mr. Neeleman in recent months started drafting a bill that would authorize the government to provide economic underpinning for private efforts to build coal-to-transportation fuel plants. The legislation, introduced in late September by Reps. John Shimkus and Rick Boucher, would enable the Energy Dept. to guarantee viable prices — paying the plant owner if crude oil fell below $40 a barrel and collecting a fee if crude rose above a certain, to-be-negotiated price. The bill calls for support for six plants, each producing 80,000 barrels a day, each costing about $5 billion. “I envisioned 70 of these plants,” Mr. Neeleman volunteers, ebulliently revealing his ambition. …

The whole idea is a no-brainer to him: Even if government pays out money, the cost would be small compared to the economic benefit of lower oil prices. “Each one would create 3,000 jobs to build it, and 1,500 jobs to run,” he predicts. The plants, built near mine-mouths, would be unlikely to incur Nimby objections. “It would turn Montana into Dubai,” he says.



1. federalist - January 16, 2007

According to data summarized from BP and EIA, the United States has roughly the same energy available in its proven coal reserves alone as is available in all of the proven oil reserves in the world outside North America!

2. federalist - January 27, 2008

WSJ reports on a coal-to-gas venture:

U.S. coal giant Peabody Energy Co. has bought a stake in GreatPoint Energy Inc., a Massachusetts start-up company that is among several ventures exploring technology that can turn coal into natural gas.

GreatPoint, which has attracted $140 million in start-up funding, says it can turn coal into gas in an environmentally friendly process at $4 per thousand cubic feet, about 40% below current prices for natural gas. Peabody says that if the GreatPoint Technology proves viable on a large scale, it foresees supplying coal to a gasification plant in Wyoming’s Powder River Basin, where it has mines and vast reserves located near gas pipelines to Chicago and the Midwest. …

The investment marks rising interest in coal gasification technology, which is intended to supply coal-based fuel without emitting the same amount of global-warming gases as when coal is burned.

Such projects could also supply gas in a time of growing demand for the cleaner-burning fuel. General Electric Co. and others have invested in coal-gasification technology, which is often eligible for government subsidies.

Coal gasification faces significant hurdles, and GreatPoint’s technology has yet to prove viable on a large basis.

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