“But what will that prove? It’s far too small to generate cashflow or be any kind of economic landmark. People have been doing Fischer Tropsch coal to diesel for 65 years”
What LNC are doing has never been done before. LNC is combining UCG with GTL. Traditional CTL is conducted by mining the coal, transporting it to a gasification plant (which costs heaps in capex and electricity) turning the coal into the gas and then converting it to diesel. Traditional CTL has a Green House Gas (GHG) footprint twice that of refining diesel from conventional oil. By using UCG and GTL, you can reduce the GHG emission footprint to the same level as conventional oil but produce the diesel at cost of about US$25 – 35 per barrel.
“the elephant in the room is getting the UCG going reliably with their techniques in sufficient scale with reliable gas characteristics.”
You hit the nail on the head. In order to get successful GTL you need a ratio of 2:1 H2 to CO. If the syngas that is produced from the UCG is 3:1 H2 to CO or higher it cannot be used for GTL but it can be used for power generation.
IMO, the difference in market cap between the 2 companies is a reflection of the progress and therefore risk. When UCG works, it can work well, when it doesn’t work, you could have a potential environmental problem.
CXY Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
