Technology developed by an Australian company is behind a major coal upgrading milestone announced for New Zealand’s coal energy sector. South Australian-based GTL Energy and New Zealand Government-owned Solid Energy New Zealand have achieved sustained production runs at New Zealand’s first commercial coal upgrading plant using GTL Energy’s coal upgrading technology. The companies also announced that they had signed an agreement for the formation of a joint venture company- GTLE Development – to focus on the operation of the plant, further project development, and deployment of the technology globally. The technology involves converting low-grade coal into higher-rank fuel by the removal of moisture from the coal and converting it into briquettes which feature higher energy content, reduced emissions, improved handling and transportation characteristics and increased market value.
Solid Energy is commissioning its Mataura briquette plant in Southland, which will produce lignite briquettes for New Zealand’s South Island energy market using GTL Energy’s technology.Once fully commissioned, the Mataura plant will be operated by GTLE Development (GTLE) through a wholly-owned New Zealand subsidiaryto produce up to 90,000 t/y of low-moisture and higher-energy briquettes from about 150,000 t/y of lignite.
The joint-venture company will manage briquette production at the Mataura plant, trial the product in international thermal export coal markets and focus on developing and deploying the upgrading technology globally.
Solid Energy will have a 20% stake in GTLE and will continue to own the Mataura plant.
Feedstock for the plant will come from Solid Energy’s nearby New Vale mine and will be transformed into a high energy product for the joint venture under a tolling arrangement which underpins continuous production.
This product will support the domestic market development along with proof of technology for global deployment. Solid Energywill market the product to its South Island customers with trials due to begin shortly.
Solid Energy and GTLE are currently in consultation with staff at the plant about transferring their employment to the GTLE New Zealand subsidiary.
In addition to the Mataura plant and its US commercial demonstration plant in North Dakota, GTLE has plant projects under various stages of development in Indonesia and Australia, and opportunities under review in the USA and Europe.
Solid Energy’s Group Manager Coal Developments, Brett Gamble,said: “We have worked closely with GTL Energy over many years, and the opportunity to combine our collective expertise and assets to accelerate commercialisation and deployment of the technology makes a lot of sense for both of us. We are excited about the future of this proposed venture and believe the transformation of low rank high moisture coal into higher energy briquettes has potential to create significant value.”
GTL Energy’s CEO, Fred Schulte, who will also be CEO of GTLE said: “This deal will create a company with the ability to accelerate technology deployment. The achievement of continuous, safe and reliable production at the New Zealand plant will provide the demonstration that is expected to support more widespread adoption. We will now have a production facility, engineering and operating capabilities in a single organisation. The new entity will be looking beyond a technology licensing business model and moving into project development, ownership and operations. Despite challenging coal and capital markets, we have exciting projects which make sense regardless of market timing, and we look forward to bringing these into fruition through 2013.”