coal to liquid lignite is proven technology

http://esperance.yourguide.com.au/news/local/news/general/oil-from-lignite-at-salmon-gums/285440.aspx

Qoute:
"Mr Woskitt said that the new extraction process has been proven in the laboratory but has not yet been applied in a commercial sense."

Oil from lignite at Salmon Gums
HAIDEE VANDENBERGHE
22/02/2008 4:35:09 PM
A PROPOSED mining operation 30km north west of the Salmon Gums townsite may be in operation as soon as 2011, according to Spitfire Oil chief executive officer Andrew Woskett.
Spitfire Oil representatives have been in Esperance this week as part of the public consultation process, which involves a range of stakeholders and community forums including those from the Salmon Gums community.

Since being granted a tenement for the area in 2005, Spitfire Oil has raised $15 million for a feasibility study to assess every aspect of the proposed project.

Mr Woskett said that the feasibility study would not be finished until the end of 2009, meaning that commercial operation of the mine may commence in 2011.

Although the majority of the lignite resource, estimated to be over 500 million tonnes, is located on uncleared bushland, some areas are on farmland that may either be leased or purchased from the landowner.

Like the proposed Blackham Resources and Wesfarmer Premier Coal joint project in Scaddan, lignite will be mined at the Salmon Gums site and converted into distillate.

Mr Woskett said that what sets the Spitfire Oil proposal apart from other coal to diesel operations is the lignite to liquids technology developed for the company at Curtin University’s Centre for Fuels and Energy.

The technology allows the extraction of gasoline, fuel oil and diesel from lignite at a lower temperature than other extraction methods, thereby reducing the greenhouse emissions that the combustion process creates.

“It’s inevitable that combusting coal will release some carbon emissions but there is also an environmental benefit that offsets this,” Mr Woskett said.

“The oil product (generated here) that is burnt ultimately releases less greenhouse gases than imported oil products.

Mr Woskitt said that the new extraction process has been proven in the laboratory but has not yet been applied in a commercial sense.

Once in full production, the mine is expected to employ 250 workers, with company workers to be based in Esperance as well as fly-in fly-out workers on site.

Although the mine is expected to produce approximately 5000 barrels of oil a day, this may be increased to 20,000 barrels a day pending future exploration and feasibility studies.

The current lignite resource can support a 30-year project at a rate of 20,000 barrels per day.

The diesel produced is likely to be transported via railway to service the consumption needs of the Goldfields, where at a rate of 5000 barrels per day, it will satisfy about 25 per cent of current demand in the region.