The coal-powered revolution

Following a 100 year gestation period there are signs we could be about to witness the birth of a new coal rush, writes Peter McCusker.

The first Underground Coal Gasification (UCG) trials - during which coal’s inherent energy is extracted in situ - were conducted in the North East in 1912.

One hundred years later scientists and businesspeople based in Newcastle, just a few miles from the site of the original trials, have launched a new drive to fully commercialise the potential of the earth’s remaining 850 billion tonnes of coal.

They are amongst a host of global teams now working on commercial-scale UCG schemes, using directional drilling techniques from oil and gas exploration, which have added new momentum to the industry.

In Australia Linc Energy’s UCG demonstration facility in Chinchilla, Queensland, Australia is operating successfully.

And earlier this year it signed a multi-million dollar deal with Chinese company GCL Projects Limited, a subsidiary of Golden Concord Group Limited, to commercialise UCG in China.

In the US, a project at Cook Inlet, Alaska, plans to go commercial in 2015, as is the US $1.4bn Swan Hills UCG site in Alberta, Canada.

In the UK the Coal Authority has granted 18 UK licences to companies keen on using UCG to access some of the UK’s remaining reserves.

Newcastle-based Five-Quarter, which has spun out of the city’s University, has the licence for a 400sq km area of the North Sea, stretching from the mouth of the River Tyne up to the Scottish border.

Prof Dermot Roddy, a director of Five-Quarter, said: “The UK was the originator of UCG technology, when Sir William Ramsay conducted exploratory experiments in the Durham coalfield in 1912.

“World War One put a stop to these and UCG was later neglected in the UK while its abundant domestic reserves of oil and gas were exploited.

“But the use of directional drilling technologies, an increased emphasis on energy security, and rising oil and gas prices has led to a renewed surge of interest.

“The technology is now maturing and reserves have been accessed with extended reach wells penetrating more than 20 km laterally at depths of over 400 meters.”

During the UCG process oxygen and steam are pumped through a directionally drilled borehole to ignite the coal.

As the supply of oxygen is limited, the coal is partially oxidised, forming a gas that still retains around 80% of the original energy content of solid coal.

This syngas – a combination of hydrogen carbon monoxide, carbon dioxide and methane - is then recovered from a production borehole for use in power generation or conversion into liquid fuels.

Five-Quarter is currently in talks with investors as it aims to raise at least £30m to start work on a demonstration facility.

Meanwhile one of the UK’s major oil and gas industry players has entered the UCG market.

Clean Coal Limited was formed five years ago by Rohan Courtney OBE, who helped to turn Tullow Oil into one of Britain's biggest companies, by exploiting neglected energy reserves in Africa and the North Sea.

It has five UK licences and is also advising on schemes in Indonesia, China, India and Vietnam.

Some of UCG’s major players have been recruited to its team including its head Marc Mostade, who has over 20 years’ experience in UCG ranging from research to managing UCG pilot plants.

He is assisted by Paul Ahner, who has participated in all of the US UCG field trials from 1977 and consulted for 18 months on Linc energy’s Chinchilla project.

Fellow CCL staffer Dr Shaun Lavis, believes UCG is the ideal bridging technology to get through the next 30 years, until renewables are more thoroughly developed.

He said: “In the last decade UCG has become more viable. The main driver of this has been the use of highly accurate drilling technologies borrowed from the oil and gas industries.

“This has helped reduce the cost of recovery with the Swan Hills scheme likely to come in at as little as US $2 per gigajoules, bringing its close to parity with that of shale gas.”

As a carbon fuel, carbon dioxide emissions concern producers and for future schemes to be politically sustainable they will need to come with carbon capture and storage.

The goaf which is left in the gasified seams is being explored as one storage option and some current schemes are using the carbon dioxide for enhanced oil recovery in subsea oil and gas fields.

The Swan Hill scheme in Canada will capture and sequestrate over 1.3 million tonnes of CO2 each year from its 300MW power station. UCG supporters say concerns over possible groundwater contamination and subsidence can be mitigated through careful site selection, project design, and monitoring.

In India, the government is looking at UCG to utilize the 60% of its 270 billion tonnes of un-minable coal.

In neighbouring Pakistan the Thar project in Sindh Province is expected to produce 100MW of electricity by the end of 2013, using UCG.

Dr Lavis added: “In areas such as India, Pakistan and Africa where they are frequent power outages and substantial coal reserves the benefits of UCG are obvious.”

With over 85% of the world’s coal reserves unmineable, UCG has the potential to play a major role in the supporting the world’s energy needs for generations to come.

North East England, the home of the railways, used its abundant coal reserves to fuel the first industrial revolution and it may now play a leading part in a new revolution in the way its abundant coal reserves are used.

Peter McCusker is an energy journalist, based in the North East of England.