Plan for CTL plant is welcome news
Bluefield Daily Telegraph
bdtonline.com
The announcement last week by West Virginia Gov. Joe Manchin that energy companies would fund a development plan and design for the state’s first coal-to-liquid (CTL) plant is encouraging news.
West Virginia is one of many states seeking to develop coal-to-liquid technology — the process of turning coal into fuel products such as gasoline, diesel and methane — and courting private investors for the billions of dollars in start-up funding required for such a plant.
CTL technology is not a pipe dream, but a proven method of fuel production used in some countries for decades.
The process was pioneered in Germany during the 1920s and, during World War II, was used to fuel Nazi tanks and airplanes. At peak production in 1944, Germany had 25 liquefaction plants that produced more than 124,000 barrels daily and met 90 percent of the nation’s needs.
Cut off from crude oil due to apartheid-related embargoes, South Africa has also utilized coal-to-liquid technology for decades.
Earlier this year, Manchin said he was committed to making the Mountain State a leader in CTL development. “It (coal-to-liquid technology) will be the most wonderful thing to happen to this state.”
West Virginia’s CTL plan will be funded by American Electric Power and Energy Village, a non-profit agency that promotes energy-focused economic development, with input from Worley Parson, GE Energy and CONSOL Energy.
Although last week’s report indicated no specific site for such a plant, the plant’s product may determine its location, according to Public Energy Authority Executive Director Paul Hardesty.
“I would venture to say a coal-to-liquid, or coal-to-diesel, has a higher likelihood of being located in southern West Virginia,” Hardesty said earlier. A plant producing a nitrate offtake has a greater chance of being located in the north central counties, while a plant with a methanol offtake would be more suited to the Kanawha or Ohio Valley regions.
Although many states are seeking government subsidies to get the ball rolling with a CTL plant, the Mountain State is focusing on private investors.
“We want the project to be commercially driven,” Hardesty told the Daily Telegraph, explaining the state wants to take a plant to Wall Street that is “bankable.”
We agree with the Mountain State’s approach in focusing on private investors.
Industry authorities report CTL technology is a viable fuel alternative when the price of crude oil is above $40 a barrel. This summer, the price has hovered around $70.
As Mideast instability continues to reverberate across the globe, CTL technology continues to look like a proven option to sever our dependence on foreign oil and curb gasoline prices.
West Virginia officials are wise to move expeditiously, yet smartly, on the development of a CTL plant. |
