To: Natedog who wrote (1628 ) 5/23/2011 7:51:36 PM From: Dennis Roth Read Replies (1) | Respond to of 1740 Mingo coal-to-gas plant breaks ground By Ken Ward Jr. The Charleston Gazette By Eric Eyre The Charleston Gazette May 9, 2011wvgazette.com CHARLESTON, W.Va. -- TransGas Development Systems marked the start of its $4 billion coal-to-gasoline plant with a groundbreaking ceremony in Mingo County Monday, promising to create 300 jobs and help bring down the price of gas. The New York-based company said the plant will covert 7,500 tons of coal a day into 756,000 gallons of premium gasoline -- about a third of the amount of gas used in West Virginia each day. TransGas plans to start construction in July and complete the project within four years. "This type of commitment will not only move us toward energy independence, but will also create jobs, boost our economy and help address the rising price of gas that comes from our nation's costly dependence on foreign oil," said U.S. Sen. Joe Manchin, who spoke at the ceremony in Gilbert Monday. Supporters of the plant said the project would create a new market for coal-derived fuels. The plant would be the first of its kind in the nation. "This country has to get serious about making energy independence a priority, which is why we must develop a national energy policy that harnesses all of our vast domestic resources and push forward with new technology, just like coal to gasoline," Manchin said. The Mingo County project isn't without critics. West Virginia Sierra Club officials said the plant's developer, Adam Victor, has a poor track record with projects. Last year, one of Victor's companies, Project Orange, filed for bankruptcy after the firm's natural gas-to-steam electricity generating plant in Syracuse, N.Y., became mired in multiple lawsuits. That plant is scheduled to be demolished. TransGas plans to sell taxable bonds to fund the Mingo County project, and repay the bonds with revenue generated by the plant. Company officials have said that private investors will provide the bulk of the project's financing. Last month, the West Virginia Economic Development Authority passed a resolution expressing its willingness to authorize $3 billion in revenue bonds for the TransGas project. The state won't be financially liable to repay the bonds if the project doesn't pan out. TransGas first announced plans to build the coal-to-gas plant in 2008, saying the project would create 200 jobs. If it were built, the project would be eligible for at least $600 million in state tax breaks, according records obtained under the state's Freedom of Information Act. While serving as West Virginia's governor, Manchin made bringing coal-to-liquids plants to West Virginia the top priority of his state energy plan. Most scientists, energy experts and environmentalists say that without carbon-dioxide controls, coal-to-liquids plant will emit twice the greenhouse gas emissions of gasoline -- when the coal is turned to liquid and when the fuel is burned. In 2008, TransGas said the plant would be a "near-zero emissions facility" that would capture carbon dioxide. Later, Victor said the company would seek federal approval to send carbon dioxide through interstate pipelines to the Texas coast, where it could be pumped underground. Those plans, however, weren't part of the project's design that the state Department of Environmental Protection approved last year. DEP officials said state regulators couldn't mandate limits on the TransGas facility's emissions. Also, TransGas has yet to revise its air pollution permit in the wake of a Sierra Club appeal to the state Air Quality Board. The board ruled that DEP didn't have enough evidence to support its conclusion that the plant's pollution controls were sufficient enough to warrant its designation as a "minor source" of emissions. The permit was sent back to DEP's Office of Air Quality for revisions. Last fall, construction unions stopped questioning TransGas' project, after the company agreed to use local workers to build the plant. TransGas said the coal-to-gas plant will produce high-octane gasoline and create 3,000 construction jobs over several years. The company plans to buy coal from area mines. Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869. Reach Ken Ward Jr. at kw...@wvgazette.com or 304-348-1702.