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CONSOL Energy Inc. announced today plans to build an $800 million coal gasification plant near Wheeling, but details of state financial aide and a greenhouse gas "management strategy" for the project were not immediately clear.

CONSOL said the project would be a joint venture with Houston-based Synthesis Energy Systems Inc. through a new firm called Appalachia Fuel LLC.

CONSOL Energy Inc. announced today plans to build an $800 million coal gasification plant near Wheeling, but details of state financial aide and a greenhouse gas "management strategy" for the project were not immediately clear.

CONSOL said the project would be a joint venture with Houston-based Synthesis Energy Systems Inc. through a new firm called Appalachia Fuel LLC.

The plant, to be built at Benwood south of Wheeling, will convert coal to gas using Synthesis Energy's proprietary U-GAS technology. It is expected that this gas will be used to produce methanol for the chemical industry. The project is also expected to be capable of converting methanol production to about 100 million gallons per year of 87-octane gasoline, the companies said.

Pittsburgh-based CONSOL and Synthesis Energy have signed a deal with state officials and a regional economic development group for financing and tax incentives.

Terms of that 10-year deal were not immediately available, said Lara Ramsburg, a spokeswoman for Gov. Joe Manchin, who joined company representatives and local officials for the announcement.

State and company officials also could not immediately explain language in a press release referring to a "carbon management strategy" meant that the plant would definitely include the capture and sequestration of carbon dioxide emissions.

"As far as a pledge and a timetable, I've had a couple of other questions about that as well, and I'm working to get answers to what that would involve," said Tim Grace, a spokesman with the Financial Relations Board and publicist firm handling media questions about the project for Synthesis Energy.

Over the last three years, Manchin has been an outspoken proponent of building a series of liquid coal plants across West Virginia. The governor says such plants would boost the use of West Virginia coal, and help reduce the nation's dependence on foreign sources of oil.

But energy and environmental experts are generally skeptical of coal-to-liquid plants, in large part because liquid coal would produce more greenhouse gas emissions, even if carbon dioxide from the fuel plants themselves were captured and sequestered.


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