evolution

Is it possible to use coal in order to reduce American dependence on foriegn oil?

I’ve said for some time that reducing this dependence should be (and currently isn’t) a long-term strategic and economic goal of the U.S., in terms of world politics, security and military strength, job creation, and scientific advancement.

Gov. Brian Schweitzer (D) of Montana is advocating for the use of technology that has existed for some time to develop his state’s coal reserves into usable fuel. Montana is currently sitting on 115 billion tons of accessible coal reserves, and who knows how much more lies in other states as well.

Coal can be converted to liquid hydrocarbon by what is called the Fischer-Trobsch process (see the Wikipedia entry). This process was developed by German researchers Franz Fischer and Hans Tropsch in the 1920s, and used extensively by oil-barren, coal-rich Germany in World War II. It was also used by South Africa to produce fuel during its economic isolation due to Apartheid. South Africa still uses it today; 28% of its fuel needs are met by coal in this way.

To convert coal into liquid hydrocarbon using this process, coal is exposed to superheated steam forming water gas, a synthesized carbon monoxide and hydrogen gas. This water gas is reacted in the presence of a cobalt catalyst to produce liquid hydrocarbons which can then be refined into methane, gasoline, diesel fuel, airline fuel, and plastic. Carbon dioxide and water are other byproducts of the reaction. Gov. Schweitzer claims in the Billings Gazette article linked above that one ton of coal processed in this way can yield 1.5 barrels of diesel fuel (which, it should be noted, is not equivalent to 1.5 barrels of oil) for about $42 per barrel, or $1 per gallon. An equal amount of conventional diesel fuel would cost you about $100 right now.

This fuel has the added advantage of burning more cleanly than conventional fuels. Conventional fuels contain sulfur, mercury, and arsenic, and those materials are left over after the Fischer-Tropsch process is complete. These can be recovered and properly disposed of or used for other industrial purposes. As to the potential effects of mining this coal, Gov. Schweitzer told the Missoula Independent (MT) that he’s not worried:

According to Schweitzer, getting to the coal is also more environmentally friendly than the hard rock mining responsible for much of the environmental damage in the western part of the state.

“For 40 years we have been surface mining in eastern Montana. Basically you peel off the top forty feet of overburden and remove about 40 feet of coal. When you’re done mining you put the material back in,” Schweitzer says. “This process is basically deep farming. The overall environmental impacts are substantially less than hard rock mining.”

One drawback to this technology is the cost of building facilities. Gov. Schweitzer said that $7.5 billion would be required to build a 150,000bbl.-per-day facility, and about $1.5 billion for a 22,000bbl.-per-day facility. However, built into the new energy bill is an 80% loan guarantee toward the cost of these processing facilities, and several companies and agencies are interested (quoted from previously-linked article):

Significant public and private investments will be required before Montana can become a national energy powerhouse. Shell, BP and Exxon are all working on gas-to-liquids technology and Schweitzer recently met with Shell president John Hofmeister and General Electric’s CEO Jeff Immelt to discuss the future of coal-to-liquids in Montana. Schweitzer said representatives from Sasol [the South African company -- ed.] are coming to Montana later this month as well. Sasol is the only company in the world producing liquid fuels from coal on a commercial level, and they do it with patented technology that can’t be bought off the shelf. Syntroleum is also interested in the prospect of turning Montana coal into liquid fuels, but the company will need large investments to develop its own technology.

Syntroleum uses a patented process of turning natural gas into synthetic fuels, and Mel Scott says the company, with Sen. Conrad Burns’s support, is trying to secure federal research and development dollars set aside in the recent highway and energy bills to add coal gasification to the front end of the process.

Will it be a profitable venture? The estimates that I have seen for the break-even point — the point at which producing fuel this way is more economical than getting it the conventional way — is between $35 and $45 per bbl. for crude oil. As we all know, crude oil has not been as low as $45 per bbl. for some time and is now at about $67 per bbl. I don’t imagine that it will ever again dip that low.

All of this makes me believe that using the Fischer-Tropsch process to convert our coal into usable fuel is worth looking into very seriously. China’s government is currently doing so, and China sits on one trillion tons of obtainable coal. Certainly it would be a better use of our tax money to spend it on research and development of these facilities than to spend it on the things you’ll find here, such as the Don Young “bridge to nowhere” or the Barack Obama Entrance to the Brookfield Zoo, just to name two.

This is not the end of the story. I have much more to read about and write on this topic. I truly believe that second only to the active promotion of representative democracy in places that don’t have it, fuel self-sufficience is of prime importance to America’s strategic, economic, environmental, and educational goals for the future.

UPDATE [10.04 11:12]: See the comments for a pair of New York Times articles on this topic and trends in oil prices, courtesy of Pigilito.

This entry was posted on Friday, September 30th, 2005 at 16:37 and is filed under politics, science. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.