Just a quick post with some clarification behind the scoping...

Just a quick post with some clarification behind the scoping study which is due next week as I have a feeling that people have taken the wrong angle to what the company is actually looking to achieve.

Basically the scoping study among other things, will outline the potential syngas and subsequent liquids that may be produced from the estimated coal tonnage.

Now there are several methods and technologies to extract gas from coals which I won’t go into detail over, however most people will be familiar with that of CSG and UCG of which there is a difference.

Without getting too technical - CSG (coal seam gas) technology extracts the gas attached to the coal leaving the seam intact, and UCG (underground coal gasification) technology ignites the entire seam and then extracts the subsequent gas produced. Unless you intend on mining the coal after then CSG doesn’t have many benefits over UCG.

See this link for info on UCG:

http://www.youtube.com/watch?v=kWZnnNG_EvU

Central Petroleum as stated in Fridays ann, is looking at the UCG process given this method allows access to gas well in excess of what CSG technology is able to produce.

When coal seams are ignited in the UCG process, it’s carried out in sections, ie 30m ignited, 30m intact hence based on this practice you end up having about 50% of the coals in the package utilized to produce syngas.

The next step in centrals case is to monetise the syngas. This is done by condensing it over a catalyst (and there are several technologies to consider here aswell) however the company at present is considering the Fischer Tropsch process. This process will have the ability to convert the syngas into high quality liquefied petroleum based products that are intended to be railed to Darwin and then exported to the market.

For those that are unaware, another simple link from Linc below:

http://www.youtube.com/watch?v=TBZGQ71yJ8g

So now that’s covered, to calculate the liquid potential that may be embedded in the coal package, with the application of both the UCG and then GTL processes, what needs to be known is that:

a) 1 tonne coal produces approximately 20,000 scf of gas via UCG and,
b) It takes 10,000 scf of gas via the GTL process to produce 1 bbl oil.

Hence 1 tonne coal = 2 bbls GTL product

Assuming we have 1 trillion tonnes of coal in the package, of which 50% is able to be used for the UCG process (as stated earlier), we’re then left with 500 billion tonnes. Knowing each tonne has the ability to produce 2 bbls we then end up with 1 trillion barrels of oil.

So the term being used that 1 tonne of coal equals 1 bbl oil is not technically correct. It’s just a summarised way to look at things when dealing with the UCG exploitation scenario.

Now, at present the worlds largest Fischer Tropsch plant is 140,000 bbl/day with Sasol/Chevron (Sasol being the worlds leading GTL operator with Shell a close second). If theoretically there were in fact 1 trillion barrels of oil potential, based on 140k per day production, central would be able to run a plant for some 19,569 years.

Based on the above assumptions, if my figures are correct -the energy contained within the package (pre GTL) is quite phenomenal;

10,000 Exajoules which, is the equivalent of 10,000,000 Petajoules.

This figure is approximately 180x the whole defined CSG reserves from the east coast of Australia at present.

And finally if the world currently has 633 gigatonnes of oil equivalent coal resource as documented from it's most recognised global coal deposits only, CTP’s potential resource if delineated would basically double this figure. N.b this image was received in 2006.

As one can see, these are very challenging numbers to comprehend but that said, they are just numbers until delineated. It would take an arsenal of rigs working 24hrs a day over several years achieve this. More than happy to sit through…