Texas university has eureka moment for coal-to-gas

Scientists in Texas say they have found a way to convert coal into gasoline at a cost of less than $30 (U.S.) a barrel - with zero release of pollutants Neil Reynolds - March 17, 2010

Canada has more energy in its "proven, recoverable" reserves of coal than it has in all of its oil, natural gas and oil sands combined: 10 billion tonnes. The world has 100 times more: one trillion tonnes. These reserves hold the energy equivalent of more than four trillion barrels of oil. They are scattered in 70 countries, mostly in relatively easy-to-mine locations and mostly in democratic countries.

The United States alone has 30 per cent of the world's reserves, and scientists in Texas say they have found a way to convert coal into gasoline at a cost of less than $30 (U.S.) a barrel - with zero release of pollutants.

Researchers at the University of Texas at Arlington (UTA) announced last month that they have developed a clean way to turn the cheapest kind of coal - lignite, common in Texas - into synthetic crude. "We go from that [lignite coal] to this really nice liquid," Brian Dennis, a member of the research team, said in describing the synthetic crude that can be refined into gasoline.

Assuming that these Texas folk are correct, this advance in technology could represent a historic moment in energy production - for Canada as well as for the United States. Canada has huge reserves of lignite coal in Manitoba, Alberta and Saskatchewan (which already gets 70 per cent of its electricity from this common coal) - not to mention in Nova Scotia.

The Texas researchers, who worked on the project for about 18 months, expect the cost to drop further. "We're improving the cost every day. We started off some time ago at an uneconomical $17,000 a barrel. Today, we're at ... $28.84 a barrel," Rick Billo, UTA's dean of engineering, told an Austin television reporter.

Texas lignite coal sells for $18 a tonne. The coal conversion technology uses one tonne of coal to produce 1.5 barrels of crude oil. One barrel of crude produces 42 U.S. gallons of gasoline. In other words, $18 worth of coal yields 63 gallons of gasoline: 0.28 cents a gallon.

In her report of the announcement, Dallas Morning News energy writer Elizabeth Souder said the U.S. government has approved construction of a small-scale microrefinery to test the UTA lab-based breakthrough. This prototype microrefinery should be in operation by year-end. "While the process doesn't create renewable fuel, it would create a domestic source for vehicle fuel and plastics," she reported.

People have been converting coal into gasoline for decades, of course, most notably in Nazi Germany. China launched the biggest coal-to-oil conversion plant in the world in 2008, in Inner Mongolia. Researchers have devised a number of ways to convert one fossil fuel into another fossil fuel - and into gasoline and diesel. But high costs have always prevented commercial exploitation of the various technologies and none of them eliminated the release of carbon dioxide into the atmosphere.

From the information released by UTA, we don't know precisely what innovation the scientists stumbled upon. The Austin TV reporter quoted Prof. Dennis as saying: "I had the idea for this while I was walking to my car. I ran back to the lab and I started drawing it out in my notebook."

As the scientists describe it, though, the technology uses "micro-fluidic reactors" that convert coal to synthetic crude at a fraction of the cost incurred with traditional conversion methods - and in a fraction of the time. The process first converts carbon dioxide to carbon monoxide, then adds hydrogen from a renewable resource - such as from the water trapped inside lignite coal. Although this manufactured crude can be processed into gasoline by conventional refineries, it can apparently be processed more efficiently in "microrefineries" that cost one-fifth as much to build as conventional refineries.

Krishnan Rajeshwar, associate dean of UTA's College of Science, said the research team doubts that carbon sequestration - the process experimentally adopted by Canada to cleanse the Alberta oil sands - will ever work. "The idea that we can dispose of massive quantities of greenhouse gases by piping them underground ... is not very practical," he said in an article last year in UTA's Research magazine. Far better, he said, to capture CO{-2} right at power plants and convert it into crude on the spot.

Could the coal-to-oil technology put Canada's oil sands out of business? Not at all, in the opinion of Prof. Rajeshwar, who thinks that it would work equally well for oil sands and shale. "The same process will work with [unconventional oil], absolutely."

Assuming, arbitrarily for the moment, that Texas has struck oil in a huge way yet again, UTA's announcement shows that energy research has finally begun to move in the right direction - simultaneously toward clean coal and the commercial exploitation of carbon dioxide. The reasons are obvious. The world has enough coal reserves to last for centuries. And it has enough CO{-2} - used as an abundant new raw material - to last forever. Harnessed together, this cheap coal and this greenhouse gas could drive the global economy for hundreds of years.

The UTA energy lab, by the way, conducts parallel research into the further commercial uses of carbon dioxide - a free commodity that, along with Canada, countries around the world now propose to bury.