Posted on 09/30/2005 1:51:14 PM PDT by John Jamieson
NEW YORK: Sasol Ltd, the worlds biggest maker of motor fuel from coal, and Royal Dutch Shell Plc are in talks to provide technology for the first US plant that will produce diesel from waste coal.
The plant will be in Gilberton, Pennsylvania, and will have capacity to produce 5,000bpd, John W Rich Jr, president of project developer WMPI Pty LLC, said this week in an interview. He said Eastman Chemical Co, which makes plastics from coal, may operate the plant, and Sasol and Shell may get a portion of sales by licensing their technology.
Loan guarantees in the US energy bill signed into law last month and soaring fuel prices spurred the project, Rich said. Pennsylvania Governor Edward Rendell plans to announce today an agreement for the state and its trucking association to buy 40% of the plants output. WMPI is asking $1.30 a gallon, less than half of current retail prices for diesel.
Its a fantastic price, Rendell said in a September 20 telephone interview. Its doable. The governor also is urging the US Defense Department to sign a supply contract, arguing that promoting a new domestic fuel source improves national security. The state, home of about 8% of US coal deposits, has gotten inquiries from others who want to convert coal to motor fuel, he said.
Unlike an earlier synthetic fuel programme now used by companies that process coal waste to be used for power generation, WMPI wont depend on federal tax credits for profit, Rich said. He said won a state tax credit and is negotiating federal loan guarantees. Private financing will fund $465mn of the $612mn project cost, Rich said. Rich, who is pitching similar projects in Indiana, Colorado and Wyoming, said hes trying to negotiate a 10-year supply contract with Pennsylvania that would allow prices to rise as production costs increase.
Sasol produces 160,000bpd at the worlds only commercial coal-to-liquids refinery, in Secunda, South Africa. The 50-year-old plant provides 28% of South Africas supplies of such fuels as diesel, gasoline and kerosene, Sasol said in an August 24 statement. The Hague-based Shell, Europes second-largest oil company, is in talks to license to WMPI technology for the first part of the conversion process, cooking coal into a gas that can be scrubbed of sulphur and other pollutants. Paul Hamilton, president of the Shell Global Solutions US technology unit, said the company has licenced 14 gasifiers in China. Bloomberg
Unless it's built close to a source of $12 coal, I might prefer to see the capital investment go to building another nuke plant.
PA Gov Rendell(D) was on CNBC hawking the plant. With its location in PA, i'm thinking it's probably a boondoggle to increase employment for unionized PA coal workers
"things-nazis-did-after-afrika-korps-bit-the-dust-ping."
LOL! Although I think the Romania and the Ploesti Oil Fields leaving the Axis was the main reason for the Nazis going the synthetic route.
PS. Nuke plants a good thing too!
"Unless it's built close to a source of $12 coal, I might prefer to see the capital investment go to building another nuke plant."
Vehicles don't run on nuke plant-generated energy.
Sasol plants since the 1950s, using technology from Hitler's era.
Sasol plants built by American company Fluor Corp.
Yet another pathway towards energy independence (or at least reduced dependency).
But the environmentalists will scream bloody murder.
Oil from Coal....Boon, Bane, or Boondoggle?
BTW, I'm all for it.
"environmentalists"
It's time to just ignore these irresponsible jerks for their own good as well as ours. They accept no solution that doesn't drag us back to the stone age.
BTTT
Glad to hear it. This is the first HARD evidence that I have seen that "peak oil" theory might be real.
As much as I like nukes---a nuke plant isn't going to produce transportation fuel---this plant will.
Why does Powder River sell so far below the rest of the market? Is it a low BTU coal?
Somewhat lower BTU but mostly transportation cost for shipping. Change it to liquids and electricity there and ship by pipe and wire.
Thanks, I did find it is a low ash and low sulfur coal.
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