Australian technology to underpin $1.4 billion coal-gas project in US

Australian-based clean coal energy technology developer, GTL Energy, has been selected by a North American energy consortium to provide its coal beneficiation technology to the proposed $1.4 billion South Heart coal-to-synthetic gas project in North Dakota. Under a Memorandum of Understanding, project partners, Great Northern Power Development (GNPD) and Allied Syngas Corp, said GTLE’s beneficiation technology had been chosen from a worldwide review of coal beneficiation technologies to upgrade the low-quality lignite reserves at South Heart.

The GTLE technology is critical to transforming the local low grade coal into low moisture high grade briquette feedstock for use in the joint venture’s proposed $1.4 billion plant at South Heart in southwest North Dakota, to produce synthetic natural gas by 2013. The commitment validates Adelaide-based GTLE’s proprietary technology which has been developed in the US since installation of its pilot plant facilities in Colorado.

GTLE’s beneficiation process converts Low Rank Coal (LRC) into a cleaner and more productive fuel by removing up to 80% of its water content, together with ash, sodium, and other impurities that interfere with clean combustion. As well as increasing the thermal value of the coal by 50-60%, the upgraded coal is easier to transport and handle, and produces significantly less carbon dioxide, nitrous oxide and sulphur dioxide emissions than if the low grade reserves were to be used without pre-treatment.

GTLE will now progress to commence construction of its first commercial scale module during 2008, to be in production by the first quarter of 2009.

As part of the agreement, GNPD – the largest owner of coal reserves in the USA outside of the US Federal Government – and Allied Syngas, will also acquire a direct ownership stake in GTL Energy – paving the way for the three partners’ collaboration in a number of other clean energy ventures.

Announcing the MOU, GNPD’s President and CEO, Chuck Kerr, said GTLE’s beneficiated coal would yield “greater energy efficiency and a smaller environmental footprint” for the eagerly awaited coal-gas project at South Heart. This technology enables us to further our mission to make the South Heart Gasification Project one of the cleanest coal-based plants in the world.”

GTL Energy’s CEO, Robert French, said that the consortium’s decision to select the Company as the coal upgrading technology for the South Heart Gasification Project was significant validation of the GTLE process. It would open up substantial opportunities around the world for gasification, but also cleaner power generation and help meet the growing energy demands of Asia and elsewhere. “We are very pleased to be working with GNPD and Allied Syngas to bring together our coal upgrading technology with their advanced gasification system, completing a suite of clean energy solutions. Our technology allows client users to exploit currently unexploited low-rank coal resources in an environmentally responsible way, to satisfy growing energy demands in an increasingly global market influenced and sensitive to climate change issues and expectations.”

The Chairman of GTLE, Robert Kennedy, said: “The application of the GTLE technology in North Dakota will prove a springboard for selling GTLE’s technology into a wider energy market. There are significant global reserves of low rank coal which will be utilised to meet energy demand. In doing so, it is critical that the coal is upgraded to ensure the energy extraction is managed in an environmentally responsible way. GTLE’s technology is applicable now, and is crucial in the development of clean energy options such as coal-to-gas and subsequent CO2 sequestration. GTLE’s proprietary technology has been developed with the support of Australian and US private investors. It is a robust, low temperature beneficiating technology which has been thoroughly tested on coals from around the world. We believe that it will have significant implications for the responsible development of Australia’s large and very extensive brown coal and lignite energy resources.”

GNPD was created to develop energy projects incorporating the coal and lignite reserves owned by its affiliated partnership: Great Northern Properties Ltd Partnership (GNP), the USA’s largest private owner of coal reserves. While GNP was formed solely for the leasing and management of its mineral land interests, GNPD was formed to assume the responsibility for all aspects of project development, including project management, financing, feasibility studies, permitting, land control, business development, and mine development. Both GNP and GNPD are headquartered in Houston, Texas.

Allied Syngas and its affiliate Envirotherm GmbH, a co-owner of the BGL gasification technology, are part of Allied Resource Corp. Formed in 1994, Allied Resource is a global technology-based industrial services company based on a growing number of technology innovations focused on environmental services, industrial processing and recycling. Headquartered in Wayne, Pennsylvania, Allied Resource also has substantial operations in Western Europe and China.