Loan to Pa. waste coal-to-fuel plant money won't be taken away
KIMBERLY HEFLING
Associated Press
mercurynews.com
WASHINGTON - The White House, reversing course, reinstated a $100 million loan to the backers of what has been billed as the nation's first plant to convert waste coal into zero-sulfur diesel fuel and home-heating oil.
The decision was announced Friday in a joint statement by Pennsylvania Sens. Arlen Specter and Bob Casey and Rep. Tim Holden, D-Pa.
Lawmakers on Feb. 5 were surprised to see a line buried in President Bush's proposed budget that would take away a loan promised in 2003 for the Schuylkill County plant because its backers had not yet secured full funding.
Under an agreement, the plant backers now have until the end of the year to secure funding for the facility before the loan is rescinded, according to the lawmakers.
Sean Kevelighan, a spokesman with the Office of Management and Budget, said the decision was reached after Specter arranged a meeting with the parties involved.
"At a time when our nation is grappling with energy security, we should be using every incentive and tool at our disposal to promote clean coal-to-liquid technology in the U.S.," Specter said in a statement.
The $800 million facility is to be built between an existing plant in West Mahanoy Township and the Mahanoy state prison. A study said it would burn 1.7 million tons of anthracite coal waste per year, creating a clear, zero-sulfur product called syngas to formulate diesel fuel, jet fuel and naphtha, a fuel and solvent.
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Plant will keep loan
BY LESLIE RICHARDSON
STAFF WRITER
lrichardson@republicanherald.com
02/17/2007
republicanherald.com
GILBERTON — The loan to help fund a coal-to-fuel plant is back on the table.
The decision was announced Friday in a joint statement issued by U.S. Sens. Arlen Specter and Bob Casey and U.S. Rep. T. Timothy Holden.
The lawmakers on Feb. 5 were surprised to see a line buried in President Bush’s proposed budget that would take away a loan in the amount of $100 million promised in 2003 to the backers of WMPI Pty LLC for a coal-to-oil project in Mahanoy Township.
“We, Gov. Rendell, Sen. Specter, Sen. Casey and myself, were never quite sure why the loan was revoked to begin with,” Holden said Friday. “We had a good conversation with Rob Portman, director of Office Management and Budget, as to why the decision was made and he said he would look into it.”
“The president, in his State of the Union address, promised to promote clean coal technologies and lead the charge for cutting America’s reliance on oil,” Rendell said last week. “But his new budget instead cuts funding for a very promising solution to our energy needs.”
John W. Rich Jr., president of WMPI, has been working on the $800 million coal project for 13 years. A coal-gasifier would turn anthracite culm waste to a zero-sulfur diesel fuel and home heating oil.
Without the loan, Rich had only two other government incentives backing his project — $47 million in tax credits the state offered him in 1999 and a $7.7 million competitive cost-share investment from the U.S. Department of Energy that Rich won in 2000.
The White House reversed its course, and under an agreement, the plant backers now have until Dec. 31 to secure funding for the facility before the loan is rescinded, according to Holden.
Casey said last week that Rich was given no fair warning the majority of his funding plan would be taken away.
“I haven’t even figured out what happened in the first place,” Rich said Friday. “The president talked about less dependence on foreign oil, so I figured it was just a mistake. I have faith in the system.”
Both Casey and Specter sent letters to Secretary of Energy Samuel W. Bodman and Portman requesting they reinstate funding for the nation’s first coal-to-diesel project.
Sean Kevelighan, a spokesman with the Office of Management and Budget, said the decision was reached after Specter arranged a meeting with the parties involved.
“Governor Rendell did a good job communicating the usefulness of the off-product,” Holden said. “He said the commonwealth would take all the product for the fleet or for home heating oil. He stressed the importance of energy independence.”
“We are continuing as we were. We are moving ahead with all of the detailed engineering work that has to be done and continuing with our development efforts,” Rich said. “Spending close to $1 billion a day to buy foreign oil is not good for our nation. Taking coal and producing ethanol, and biodeisel is the right thing to be doing. It will keep money and jobs in this country.”
The proposed facility is slated to be built next to the State Correctional Institution/Mahanoy. A study said it would burn 1.7 million tons of anthracite coal waste per year, creating a clear, zero-sulfur product called syngas to formulate diesel fuel, jet fuel and naphtha, a fuel and solvent.
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