Significant progress is being made on development of the largest coal liquefaction plant in the US. Medicine Bow Fuel & Power LLC (MBF&P), a wholly-owned subsidiary of DKRW Advanced Fuels LLC (DKRW), headquartered in Houston, Texas has signed licenses to use key technologies and an agreement for the coal supply. DKRW's proposed coal-to-liquids facility is in Medicine Bow, Wyoming. The first phase of the Medicine Bow project is designed to produce approximately 11,000 bpd of ultra-clean diesel fuel and other fuels from Carbon Basin coal. MBF&P plans to eventually expand the plant capacity to 40,000 bpd. DKRW had previously announced that construction was to begin in 2006, with initial operations to begin in the 2008-2010 timeframe.
It announced on March 1 that it has signed a site license agreement with GE Infrastructure Technology LLC, a wholly-owned subsidiary of the General Electric Company (NYSE:GE), for the use of GE's patented and proprietary coal gasification technology.
DKRW also has an agreement with Rentech, Inc. (AMEX:RTK), a Denver based technology company to license their Fischer Tropsch technology for use in the Project.
MBF&P has already entered into an agreement with Arch Coal Inc. (NYSE:ACI), the second largest U.S. coal miner owner and operator, for the purchase of high btu, low sulfur coal from the Carbon Basin Reserve. Arch will act as constructor and operator for the Medicine Bow coal mine sufficient to support the first phase of the Medicine Bow project and to expand up to 40,000 bpd.
The Project will transport diesel and other fuels via pipeline to major energy companies in the region. During the initial phase, it is anticipated that power (45 MW) not utilized in the CTL project will be sold to regional electricity providers. Carbon dioxide will be stripped, sold via pipeline and sequestered in regional enhanced oil recovery operations. Sulfur will be removed from the process, solidified, and sold into the agricultural market. The Medicine Bow project’s power will be produced in gas turbines in combined cycle mode from the synthetic gas and by steam turbines using the steam generated by the gasification and the FT processes. The end result is that the Project's power is produced with very low carbon dioxide and SOx emissions.
"DKRW's business focus is to utilize the world's abundant coal reserves along with key technologies to produce new, reliable, and more environmentally friendly energy supplies. We have multiple opportunities and the expertise which will enable us to become a leader in the coal-to-liquids industry within the next 5 years," stated Jon Doyle, a DKRW partner.