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Carrying Southland lignite coal to North Dakota appears to be taking the ‘coals to Newcastle’ approach to the extreme, but it may help unlock Southland lignite developments. LINDSAY CLARK explains.
A commercial scale lignite briquetting plant has just been built at South Heart on the huge North Dakota lignite fields by Australian company GTL Energy. Solid Energy and GTL Energy recently entered into a joint venture agreement to investigate the feasibility of building a 100,000 tonne a year lignite briquetting plant in Mataura using lignite from the New Vale mine. The briquettes will burn hotter and cleaner than unprocessed lignite – the ugly duckling of the coal industry that usually burns with a low energy output because it contains over 40 percent water. The lignite briquetting plant could provide the front end technology for Solid Energy’s much larger lignite gasification schemes. However, Solid Energy’s initial aim is to upgrade with lignite briquettes to serve its current coal customers. Brett Gamble, Solid Energy’s general manager for its new energy projects, says the new briquetting technology is expected to offer a significantly higher grade and cleaner energy source for South Island industrial and commercial customers. Shipping a bulk sample of lignite to GTL Energy’s US plant was expensive but was a less-costly option than building the plant at Mataura, then discovering the process did not work properly with the local lignite. Some of the lignite briquettes processed in North Dakota will be shipped back to New Zealand for trials with Solid Energy customers. Currently the largest customer for the company’s New Vale lignite is Fonterra’s Edendale plant – the world’s largest milk-processing plant just 15 kilometres from the mine gate in the middle of the growing Southland-Otago dairying region. The lignite briquetting upgrading plant would be built inside the now-closed Mataura paper mill. The plant could be operational by 2011 if the go-ahead decision is taken soon. Solid Energy has been talking for some time of using gasification technologies to unlock the vast potential of Southland’s multi-billion tonne lignite deposits by making them into high value products. Last year SE announced plans to investigate building a $1.5 billion lignite-to-urea fertiliser plant in a joint venture with fertiliser manufacturer Ravensdown. This could be the first step to Solid Energy establishing a “syngas park” supplying synthetic gas sourced from lignite. This could supply clean syngas to multiple future downstream applications including diesel as well as urea or other forms of energy such as electricity, synthetic natural gas, or even hydrogen fuel. Solid Energy has also been conducting a pre-feasibility study into a diesel plant that could supply most of New Zealand’s diesel needs.
The resourceSolid Energy controls over 1.3 billion tonnes of lignite resources in the Mataura, Croydon and Waimumu fields. Most of the coal lies in the massive Mataura field containing some three billion tonnes of in-ground lignite. About 500 to 700 million tonnes of the medium quality lignite (44 percent total moisture and eight percent ash) may be economically recoverable from the central part of the field. The highest quality field is the Croydon field east of Gore and 10 kilometres from Mataura, that contains approximately 500 million tonnes of in-ground lignite. As much as 200 million tonnes of the deposit may be recoverable. Croydon lignite has a low 41 percent water content and very low ash content in the major seams. A mine at Croydon would have a low stripping ratio. A linked Mataura-Croydon mine development to supply a major syngas project would have the effect of lowering the stripping ratio average for the combined mines to about 3:1 as well as lowering the average moisture content and ash content. The Waimumu field, containing the producing New Vale mine, lies 10 kilometres west of Mataura and contains over 300 million tonnes of in-ground lignite and about 90 million tonnes of mineable lignite in the New Vale area. The decision to investigate building a 1.2 million tonnes a year capacity nitrogenous urea fertiliser plant as the first option for lignite gasification could be a smart political as well as commercial move. With Southland an out-and-out farming province showing strong support for energy developments, the prospect of a fertiliser plant backed by the South Island-based farmers co-operative company Ravensdown can be expected to draw strong approval from farmers and local bodies. New Zealand currently imports about 500,000 tonnes of urea fertiliser a year, about 60 percent of its needs. The prospect of gaining 500 permanent new jobs for the fertiliser project for an area with declining population is also likely to win support. The main opposition to lignite developments is likely to come from concern about a major increase in emissions from climate-warming carbon dioxide. Solid Energy is taking a multi-pronged approach to dealing with greenhouse gas emissions. It is attempting to ensure efficient design of plant to keep carbon emissions at the lowest possible level, such as with the lignite briquetting plan. The company is also carrying out research into possible underground rock strata in the Southland-Otago area which could bury liquefied carbon dioxide by geosequestration. Solid Energy is also thinking outside the square on the carbon issue and is funding a five-year research project with the Department of Conservation in native forest on the West Coast employing hunters to destroy deer and goat pests. This trial aims at measuring carbon storage in native forest re-growth. With native forest storing about 80 percent of New Zealand’s carbon stocks (and planted forests about five percent), Solid Energy says even a one percent increase in carbon sequestration capacity from public conservation forests could remove as much carbon from the atmosphere as New Zealand’s annual carbon emissions. The moisture challengeOne of the problems with using lignite as a fuel feedstock is its high water content. Lignite in its natural state can be one-third water or, in other words, for every three rail wagons of coal, one wagon would be nothing but water. The high moisture content effectively dilutes the energy content of the fuel making it costly to transport lignite anywhere but close to the mine. Mataura coalfield lignite contains about 44 percent moisture by weight compared with the low water content of exported Stockton bituminous coal is only eight percent moisture. GTL Energy reports on its website that trials on two samples of Southland lignites reduced moisture content down to 12.5 percent from the original total moisture of 46 percent in a lower grade sample and 42.5 percent a higher grade sample. The expelling of water from the coal to form briquettes has the important effect of increasing the energy content of the processed coal. The lower quality Southland lignite sample with the original 46 percent moisture content increased its energy content from 5500 British thermal units (BTU) to 9500 BTU once the lignite was briquetted. The higher quality 42.5 percent moisture content sample had a higher energy content of 6500 BTU to begin with. But once dried into briquettes the energy content rose to 10,000 BTU. Briquetting of coal has been used in the coal industry for many years but the GTL Energy pre-combustion process dries the coal by an efficient low temperature method. GTL Energy claims that it is a cost-effective alternative to high-cost thermal drying technologies historically used to reduce water content of low rank coal. The removal of moisture and other impurities also means the upgraded ‘clean coal’ will reduce greenhouse gas emissions.
Q&M Vol.7 No.1 February-March 2010 |
Coal producer Solid Energy has shipped a 500 tonne bulk sample of its Eastern Southland lignite to North Dakota to be put through a new process that will significantly upgrade the energy content by squeezing out large amounts of water from the coal.