Coal into Petroleum

(I have written many short articles on Oil and Gas system. Here is one related to this posting)

Coal to Liquid (CTL) is one of the unconventional methods of the oil production system. Other major unconventional oil systems are: Oil Sands, Shale Oil and Biomass to Liquid (BTL).

Converting coal to liquid (CTL) fuel allows coal to be utilized as an alternative to fuel oil. There are two different methods for converting coal into liquid fuels:

(1) Direct Liquefaction - It works by breaking coal down in a solvent at elevated temperature and pressure. This process is highly efficient, but the liquid products require further refining to achieve high grade fuel characteristics.

(2) Indirect Liquefaction - It involves first gasifying the coal into "syngas" (a mixture of hydrogen and carbon monoxide) and then making synthetic fuels from this syngas. Using modern technology, indirect liquefaction produces environmentally compatible high quality and ultra-clean products.

Conversion ratios for CTL are generally estimated to be between 1-2 barrels/ton coal. Liquefaction can also be affected by the different properties of the coal feedstock. However, liquid yield comparisons are tricky, as yield is dependent on the chosen technical system, the coal type used, system borders and many other factors.

South Africa has been producing coal-derived fuels since 1955 and has the only commercial coal to liquids industry in operation today. The CTL fuels are used in not only in cars and other vehicles, South African energy company Sasol's CTL fuels also have approval to be utilized in commercial jets. Currently around 30% of the country's gasoline and diesel needs are produced from indigenous coal. CTL is being developed for industrial-scale production in China and by other major industrial countries.

The US has the world's largest coal reserves and has been subjected to many CTL feasibility studies and projects which many times appears with increased cost and social and environmental impacts.

The world's biggest reserves of coal are (in billion tones or giga-tones):

The United States - 242.6 - 28.6% of the global total

Russia - 157 - 18.5%

China - 114.5 - 13.5%

Australia - 76.5 - 9%

India - 56.6 - 6.7%

South Africa - 48 - 5.7%

More Information for World Coal Production and Reserve:

http://www.coalportal.com/production_trade_data.cfm?data_type=Production

http://en.wikipedia.org/wiki/Coal_producing_regions

- MS

In light of $100+ per barrel crude and a coal value in the range of $25/ton at the mine and given the extensive research and process demonstration body of knowledge available in the archives of the Bureau of Mines validating feasibility of CTL, wouldn't it make sense for the US Government together with a consortium of qualified corporations undertake to build such a synthetic fuel manufacturing capability in this country. The impediments to this, i.e. objections by the petroleum refining industry and the environmentalists are political and personal self-serving interests and I believe do not reflect the true economics. Even at 2 bbls of oil per ton, there is the potential for giga-barrel supply of dometically produced oil sitting in our midst. What is the real investment cost to do this and what are the process economics in terms of net cost per barrel for the produced oil? Comments??

I certainly don't know any of the answers but I am familiar with several uranium facilities around our country which are either completely or partially closed because of drop in need of uranium. Seems like they would be ideal for such a coal to petroleum facility. Wonder how quickly such a facility could be put on online compared with new drilling for oil?

Don't know about uranium facilities, re. geographic locations and relationship to coal mining infrastructure. I think to make economical CTL the operation would best be located at the coal mine or within easy transport by coal slurry pipeline. Without doubt investment and timing would be disadvantageous relative to new oil drilling, but the question is uncertainty about amount of long term oil reserves within USA control and cost of exploration to find sources over the long term. The coal availability is a certainty, i.e. no risks on that part. A decision to do this must carry a strong weighted preference based on long term strategic national interests. That's why it requires a government/private industry partnership.