Break

Comparing the Economics of UCG with Surface Gasification Technologies
Eric Redman, shareholder, Heller Ehrman LLP (co-chair of Clean Energy Technologies Group)
At locations where UCG makes sense, its economics are likely to be compelling. On a cost per MMBtu basis, UCG is inexpensive for many reasons, including by avoiding the need for conventional coal mining operations, construction of a gasifier, downtime for gasifier maintenance, and installation and operation of an air separation unit (ASU) or a syngas cooler. As Julio Friedman's presentation will demonstrate, the costs of CCS sufficient to meet applicable standards may also be less than for surface gasification technologies. But no extensive pipeline system yet exists for air-blown syngas, and UCG is not possible in locations without suitable coal and appropriate geology. In such locations, surface gasification is likely to displace coal-burning technologies eventually, barring extraordinary breakthroughs in post-combustion CO2 capture.

The conventional, first-generation, refinery-based gasification technologies (Shell, ConocoPhillips, GE's ChevronTexaco) enjoy some advantages, including high throughput volumes, the availability of creditworthy commercial warranties, and high-calorie value oxygen-blown syngas suitable for "polygen" applications and not just power production. The second-generation, "advanced," and non-refinery-based gasification technologies derive from furnace, smelting, and synfuels technology predecessor. None is fully warrantable yet, but several offer the promise of lower costs, smaller scale, greater efficiency, greater fuel versatility, greater modularity, and higher availability than conventional surface gasifiers. Some also are straight-to-methane technologies. Like UCG, these advanced technologies have received comparatively little attention, but should begin to emerge and begin to be deployed extensively in the relatively near future. The recently-acquired but commercially proven Siemens GSP (formerly Sustec) surface gasification technology combines features of conventional and advanced surface gasification technologies, and should also begin to make its mark soon.

Lunch

GasTech, BP Move PRB UCG Trial Forward
Steve Morzenti, president, GasTech Inc.
BP and GasTech Inc. reached an agreement to progress the possible deployment of underground coal gasification (UCG) technology in coal deposits in Wyoming.  UCG is the in-situ conversion of coal into gaseous fuels and other products, with the potential to produce energy and hydrocarbon feedstocks from otherwise unrecoverable coal seams.

GasTech holds significant coal leases in the Powder River Basin of northeast Wyoming in which the coal is too deep for conventional mining. For the past two years, the company has been carrying out feasibility studies into the potential application of UCG technology to these coal deposits.
Under the terms of the agreement BP will study the possibility of developing an initial pilot-scale demonstration of UCG on GasTech’s coal leases.  Any planned project would be subject to consultation and full permitting.

UCG involves the injection of controlled supplies of air or oxygen into a coal seam, allowing the coal to be reacted in situ to produce mixtures of hydrogen, methane, carbon monoxide, CO2, and other gases.  These gases can be recovered to the surface through wells and used as fuel for power generation or as feedstock for the production of liquid hydrocarbons, chemicals and other products.
GasTech, Inc., founded in 2001, is a member of the Wold Companies Group and is based in Casper, WY.  BP is an international energy company with extensive experience and activities managing and producing coal bed methane and other gas resources.

Eskom Expands Majuba Power Plant UCG Project
Michael Blinderman on behalf of Eskom
Eskom is moving ahead with the next phase of an UCG project to increase coal reserves. Declining coal reserves have been cited as one of the biggest problems facing Eskom, as it struggles to overcome a power shortage that has led to blackouts for South African residents and industry since January.

Chris Gross, corporate specialist at Eskom's strategic generation research unit, said a plan to pipe greater volumes of gas to the Majuba power station in Mpumalanga province would help it become more coal efficient.

The project currently sends about 3,000 cu. m per hour (CMH) of flared gas. Volumes will increase to 70,000 CMH early next year and be piped to the station before eventually rising to 250,000 CMH. Some 3.5 million CMH will be supplied to the power station at full production that is anticipated around 2012. Gross said it would have the benefit of reducing the amount of coal that they will have to deliver to the station, which is obviously a major problem.
Coal from nearby mines supplies the Majuba power station but transportation costs have risen significantly because of bad roads. Gross explained the quite deep coal is needed and as a result of that it actually opens up a different resource - unmineable coal.

 Eskom's resources and strategy unit estimated there are an additional 45 billion tons of coal suitable for UCG in the country, excluding coalfields in KwaZulu-Natal province.
 Eskom produces about 95% of South Africa's electricity and is spending billions of dollars to expand its generating capacity as it struggles to cope with rising demand from the country's growing economy.

Break

Underground Coal Gasification in India – An Initiative by AE Coal Technologies
Abhishek Jayaswal, director, AE Coal Technologies India Private Limited, an Abhijeet Group Company
The declining reserves of crude oil & natural gas along with the coal reserves that can be mined economically by conventional mining methods and volatility in international prices have renewed the interests of various countries in Underground Coal Gasification (UCG). Further, tremendous pressure from environment lobby for adoption of Cleaner Coal Technologies has prompted the industries to seriously think UCG as option for power generation, manufacture of fertilizers, petroleum products etc.
Considering the huge gap between Demand & Supply of Power and also the availability of coal, India has immense potential for generation of power through Underground Coal Gasification. AE Coal Technologies India Pvt. Limited, a company belonging to ABHIJEET GROUP of India is implementing Underground Coal Gasification Projects in India. This presentation discusses the various initiatives being taken by AE Coal Technologies along with Ergo Exergy Technologies, the world leader in UCG for implementation of UCG in India.

UCG: the Missing Piece in the World's Energy Puzzle
Brett Wilcox, CEO, Laurus Energy and previously CEO of Summit Power Alternative Resources
Underground Coal Gasification is gaining increasing public attention. But so far, energy policy makers have not incorporated UCG's potential to meet the world's energy needs into their supply plans. UCG can be the critical missing piece to supply growing demand for liquid fuels, electricity and other energy needs in an economic and environmentally acceptable manner. Most energy sources require a tradeoff between the cost of energy, energy security, and climate and environmental impacts. UCG is the only technology on the horizon that can improve all three measures without having to sacrifice one goal for another. And unlike other potential energy technologies, UCG is ready to go now, can be deployed quickly, and can be scaled up to a large supply in many locations with a reasonable capital investment.

UCG: History: RM-1 to Bloodwood Creek
TIm Cornitius, on behalf of Burl Davis ,Carbon Energy

Rocky Mountain 1was a US UCG test completed in 1988 that demonstrated the technical feasibility of the controlled-retracting injection-point (CRIP) process as an underground coal gasification (UCG) module configuration or CRIP UCG.
Carbon Energy PL of Australia will now demonstrate the commercial feasibility of the CRIP UCG process at Bloodwood Creek with a 100-day field trial.  The facility design will be based upon the RM-1 experience with improvements that move the technology from an experimental stage to commercial reality.

The trial will be performed as the first module of a commercial facility that will generate 1 PJ (petajoule) per year of syngas with a three-year module life.  Each module will produce enough syngas to produce 20 MW of electricity in a combined-cycle gas-turbine power plant.
At the end of the trial, the module will be held on a standby mode while surface facilities for commercial production are put in place.  A technical update prepared by Burl Davis, UCG process consultant, Carbon Energy, will be presented at the conference. 
RM-1 was one of a series of US UCG tests conducted in Wyoming during the 1976-1995 time period.  Those tests included Hanna (7), Hoe Creek (3), Rawlins (2), Rocky Hill 1 (1), Rocky Mountain 1 (1) and Carbon County UCG (1)
Analysis has confirmed that innovative RM-1 design features such as operating at low pressures and post-burn cavity venting and cooling are effective in terms of efficiency and environmental impact when using UCG technology.

Day 2: Thursday, July 17, 2008

7:45 - 8:30 AM Continental Breakfast   Second Day Introduction Tim Cornitius, editor, Syngas Refiner 8:30 - 9:00 AM Maximizing the Potential of UCG by Leveraging Core Mining Competencies Dr Steven Pearce, Manager – Underground Coal Gasification (UCG), Solid Energy New Zealand Ltd, New Zealand. New Zealand is a tectonically active country which has resulted in our coal deposits being both faulted and folded and, in some cases, laid down on undulating basement topography. This geological complexity presents considerable technical challenges to the successful planning and extraction of coal. Solid Energy New Zealand Ltd is an energy company founded on mining coal in difficult conditions and therefore has developed a wealth of knowledge, experience and IP in the area of resource identification, characterization and development for both opencast and underground mining in challenging geological environments. UCG is a mining method which complements Solid Energy’s currently employed mining methods. The skills required to successfully develop a UCG facility are also complementary to Solid Energy’s core competencies in the mining industry. UCG has the potential to allow low cost access to coal that is currently not technically or economically accessible by currently employed mining methods. Solid Energy has exclusive rights to apply the Ergo Exergy’s eUCG technology within New Zealand and is currently investigating the potential for the application of UCG in New Zealand. An overview of Solid Energy’s upfront geological, geotechnical and hydrogeological characterization and planning skills that are fundamental to a successful UCG development will be presented 9:00 - 9:20 AM Development of a UCG based project in Canada Simon Maev, managing director, Laurus Energy Inc. Underground Coal Gasification technology is getting significant attention around the globe as a new mining method to extract energy of stranded coal where other methods are not applicable.          Laurus Energy Inc is an exclusive Canadian Licensee of the Exergy UCG . (UCG) technology provided by Ergo Exergy Technologies Inc from Montreal, Canada. The UCG technology is being successfully applied in a number of commercial UCG projects around the world.          Laurus Energy Inc. is developing its first commercial project based on Underground Coal Gasification technology in North America. The project is targeting power generation and supply of fuel and hydrogen for the local industrial markets.          Laurus Energy Inc. has large coal holdings in Alberta, Canada and started execution of its first Tomahawk I project development program, including regulatory and environmental approvals, Site Selection and Pre-Feasibility Study, and Site Characterization program. 9:20 - 9:40 AM Main Directions of UCG Research at The University of Queensland, Australia A. Y. Klimenko, Reader, School of Engineering, University of Queensland, Australia This presentation will review UCG research in The University of Queensland (UQ). While this research has significant computational and experimental components, the main distinctive feature of UQ approach is its strong theoretical component that is aimed to improve our understanding of UCG processes. The UCG technology is of inherently multidisciplinary nature involving the issues of combustion and fluid flow in porous media, geological issues and advanced mathematics. This underlines the complexity of UCG processes and creates conditions for cooperation between researchers with different backgrounds. We shall consider the main directions of UCG research at UQ in the context of recent dramatic rise of worldwide interest in UCG. These directions involve reverse and direct combustion linking techniques, steam jacket and its stability, asymptotic analysis of stability of channel widening techniques. 9:40 - 10:00 AM Break 10:00 - 10:20 AM Realizing UCG's Climate Benefits Through Environmental Protection Mike Fowler, technology coordinator, Coal Transition Project, Clean Air Task Force Growth in carbon dioxide emissions from coal combustion threatens the world's climate at the same time that increasing construction costs make commercialization of CCS-enabling technologies difficult. Underground coal gasification can enable cost-effective CCS and help mitigate climate change, but only if traditional environmental concerns (e.g., groundwater protection) are appropriately addressed. An NGO perspective on the opportunity of UCG, and the challenge of environmental protection, is advanced. 10:20 - 10:40 AM Maximizing Syngas Value by "Following the Carbon Trail" Tom Tillman, Founder, TEXYN As the gasification industry in the US retreats from IGCC projects, and begins exploring synthetic fuels as an alternative product, project developers need to "Follow the Carbon Trail” to maximize all of their syngas value.  This includes the worth of captured carbon dioxide as a valuable product for Enhanced Oil Recovery.  Some synfuels lead to higher rates of carbon capture than others.  A method of simplified “Carbon Accounting” can reveal the true value of syngas when several syngas monetization paths are explored. This risk-management exercise is to find the best combination of (1) highest combined products value, (2) lowest project capital costs, and (3) the least exposure to CO2 litigation risk.  A case is made here for the consideration of establishing Hydrogen as the “Energy Carrier” product out of the syngas.  Monetization through Hydrogen will be compared to syngas monetization through power and through methane (SNG).  The Hydrogen path leads to the maximum amount of carbon capture.  Who could buy that much Hydrogen and CO2?  How can these products impact our global energy future in the next 25 years?  What are the specific implications for a UCG project when Hydrogen is the “energy carrier” and when carbon capture and sequestration (CCS) becomes the de facto standard?  10:40 - 11:15 AM Next Steps toward Developing Best Practices for UCG Elizabeth Burton, Thomas A. Buscheck, and Souheil Ezzedine, Lawrence Livermore National Laboratory The rapid development of underground coal gasification (UCG) technology over the last several years merits a reassessment of the current state-of-the-art and of future science and technology needs for UCG. In particular, there is a need to explore the potential application to UCG of quantitative simulation of subsurface processes, an area that has advanced substantially since most UCG R&D was done. This effort builds on the “Best Practices in Underground Coal Gasification” white paper developed by Lawrence Livermore National Laboratory (LLNL) in 2006.          One of the most important issues which must be addressed to assure the commercial success of UCG technology is improving the predictability of economic gas production and of the environmental consequences of operations. Both of these issues require improvements in the ability to accurately simulate subsurface thermal-hydrologic-chemical-mechanical (THCM) processes. Pilot studies showed the importance of maintaining UCG operations within a critical range of injection pressure—high enough to prevent excess water from entering the cavity (to optimize the gasification process), yet low enough to avoid gas loss and contaminant migration away from the cavity into the surrounding environment.           LLNL is coupling its expertise in UCG and in solving analogous problems, such as nuclear waste storage, to develop a robust simulation capability for UCG. This capability will allow a quantitative reassessment of the key knowledge gaps and will draw on recent and historical data to identify parametric dependencies and to develop sensitivity analyses, model calibrations, and recommendations for operations optimization.   11:15 - 12:00 PM Technical Panel Discussion 12:00 PM Conference Ends

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