25 June 2012

Coal Will Be Thriving Long After Obama Is Gone

This article was previously published on Al Fin Energy blog

The National Coal Council delivered a report to the US DOE which points to increasing uses of coal -- to generate electric power, to produce large quantities of liquid fuels via CTL, and to expedite enhanced oil recovery (EOR) using CO2 recovered from coal gasification (both IGCC and CTL).
  • By 2035, the combination of coal-based EOR and CTL technology could provide up to 30 percent of U.S. liquid fuel demand and ensure America's energy security for decades....
  • Use of ... CTL could generate $200 billion in economic activity, more than 1 million skilled jobs and $60 billion in tax revenues.
  • At least 100 gigawatts of advanced coal generating capacity could be built or retrofitted over the next two decades. These advanced plants would use an additional 300 million tons of coal annually.
  • CTL plants with carbon capture could convert coal into more than 2.5 million barrels a day of additional oil. An additional 450 million tons of coal would be used annually in these operations.
  • Capturing a high volume of CO2 for commercial purposes, coupled with CTL operations, would increase coal use to 1.75 billion tons annually. This production level is well within the capability of the United States, home to 30 percent of the world's coal reserves.
_Nat.Coal Council Report to US DOE

Obama's misguided war against coal -- along with his war against all other forms of viable energy -- mark him as a political activist rather than a true leader. Obama's war against energy and against the US private sector has led to a stagnant economy with very slow job creation.

Meanwhile, Primus Green Energy is pushing ahead with a shale gas - to - liquids project which hopes to produce 100 million gallons of gasoline from shale oil per year.
The allure of cheap nature gas has altered the course of a New Jersey biofuel start-up’s path to commercialization. Shale gas will serve as Primus Green Energy’s (PGE) bridge fuel until it shifts to biomass feedstocks.

PGE today held a dedication ceremony for a demo plant at its Hillsborough, NJ headquarters. Local luminaries and a swarm of politicians, including former governor Jim Florio, Representative Leonard Lance, and an Obama administration agricultural official, were in attendance.

The plant will create up to 5 barrels of fuels per day, which will be used for customer certification testing and approvals. It is also a proof of concept for technology that PGE says can scale to upwards of 100 million gallons per year at a significantly higher yield (35 percent) than the industry average.

The company is hoping to raise US$150 million to build a facility next year that would produce 20 million gallons of fuel annually. In comparison, the Pearl GTL (gas to liquids) facility in Qatar has cost over $19 billion to build. _SP
The Pearl GTL plant in Qatar expects to yield profits of $6 billion a year, for as long as the price of crude oil (Brent) remains above $80 a barrel.

Primus Green Energy had intended to be a biomass-to-liquids (BTL) company rather than a GTL company, but basic economics dictated Primus' decision to go with shale gas rather than biomass -- at least in the beginning.

Meanwhile, commodities prices remain well above 2007 levels, suggesting that without big government stimulus from the US, Europe, and China, there is still significant deleveraging and deflating of bubbles that could occur.

The billions which Obama spent on his green energy crusade created almost no jobs, and has had a negligible effect on the nation's energy supplies. Most of the $billions went to political cronies of the president, and that money is long gone. Several of Obama's startups have gone bankrupt, with others in very deep financial trouble. Mr. Obama's great green crusade is turning out to have been a grand political gesture to get elected. What will he do for an encore?

The Obama government has injected about $1.5 trillion per year of fiat stimulus into the US economy, with very little positive effect to show for it -- except a rapidly growing debt which could destroy the economy if interest rates should be forced upward.

The energy world does not exist apart from the political and economic worlds, but is rather inextricably enmeshed within both.

Obama has attempted to re-shape the energy worlds, the political worlds, and the economic worlds -- as a legacy to his own unique greatness. Time will tell what lasting impact Obama's policies have had on those worlds -- if any.

See also: The Slow Sinking of Obama's Green Energy Policy

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“During times of universal deceit, telling the truth becomes a revolutionary act” _George Orwell

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