WA company plans to trial UCG PETRINA BERRY July 26, 2010 - 3:09PM
AAP
A West Australian mining company is planning to trial underground coal gasification (UCG) in the same southern Queensland town where another UCG project was forced to shut down because of a water contamination scare.
Cougar Energy's UCG pilot plant at Kingaroy, northwest of Brisbane, was closed down last week after traces of the cancer-causing chemicals benzene and toluene were found in bores near the plant.
The Kingaroy community is now horrified to learn another mining company plans to trial UCG, the burning of coal underground to create a gas that is piped to the surface, within kilometres of the town.
Red River Resources managing director and geologist John Karajas told AAP the company wants to set up a pilot plant about three to five kilometres south of the Kingaroy township.
Mr Karajas said this was subject to shareholder approval and the lifting of the Queensland government's moratorium on new UCG projects since the water contamination scare.
He said he believed the technology was safe and won't affect ground water.
"Any waters produced during the underground coal gasification process would be limited around the coal seams and there wouldn't be much communication with other ground water in the area," Mr Karajas said.
"It's my sincere belief that UCG is a better way for power generation than digging up coal and burning it.
"It probably has less of a carcinogenic effect than burning coal at power stations."
A spokesman for Natural Resources Minister Stephen Robertson said no other UCG trials were being considered until the industry was proven to be viable.
Red River Resources' website says the Kingaroy area was unlikely to be declared "off-limits" for further UCG trials beyond 2012-13.
There are a total of three pilot plants, including Cougar Energy's plant. Linc Energy and Carbon Energy run two other UCG projects near Chinchilla.
The Kingaroy Concerned Citizens Group spokesman John Dalton said the technology was filthy and should be banned.
"After only a few tonnes of coal were burnt at the Cougar plant levels of benzene reached the maximum allowable levels for drinking water," Mr Dalton said.
"Imagine the impact if the plant burnt the 20,000 tonnes of coal allowed in its permit."
The town is holding a community meeting about the latest development on Tuesday.
CXY Price at posting:
7.5¢ Sentiment: Hold Disclosure: Held
