"Where is synthetic fuel made today?
South Africa is the leading producer. For decades, it has operated plants that produce an estimated 300,000 barrels of gasoline and diesel a day from coal. A number of other countries, including Qatar, Malaysia and China, are investing in either coal gasification or synfuel production. Increased global demand for oil and other energy has driven up prices and made synfuel production an economically viable alternative.
How would the military benefit from synfuel?
The Office of the Secretary of Defense recently issued a Clean Fuels Initiative proposal to run all battlefield engines on a synthetic fuel. Though its fulfillment may be many years away, this strategy would enable the military to 1) avoid buying oil from unstable regimes that are known sponsors of terror, 2) mitigate supply chain vulnerabilities to events like Gulf Coast hurricanes, 3) meet clean air requirements in European countries where we have airbases, and 4) simplify the fueling of battlefield equipment that presently run on multiple fuels.
Why haven't synfuels been pursued in America before?
They have. In fact, the U.S. government was exploring synfuel as early as 1925. In the 1940s, a Synthetic Liquid Fuels Act passed by Congress appropriated over $80 million for research and production. By the 1950s, America was producing thousands of gallons of synthetic gasoline a day at a test plant in Missouri. But the discovery of cheap oil, combined with a lobbying effort by the oil industry, caused the government to abandon its synfuel research. During the oil crisis in the late 1970s, the federal government briefly pursued synfuel production, but abandoned the idea when the price of oil receded.
Are there other applications of this technology?
In addition to making liquid fuels, coal gasification can be used to generate electricity with virtually no emissions. Looking to the future, it can be used to produce hydrogen for use in fuel cells. Gasification also can be used for industrial products such as naphtha, chemicals, waxes for cosmetics, fertilizers, and carbon dioxide for enhanced oil recovery.
Is synthetic fuel cost effective?
Yes. The cost of making a barrel of synthetic fuel is estimated to be around $55, including the sizeable infrastructure investments and the labor force necessary to operate the plant. At the current and projected price of oil, production should be a cost effective enterprise. Key economic incentives in the recently enacted federal Energy Bill, such as 80% loan guarantees for certain coal liquefaction projects, reduce the economic uncertainty of bringing this technology up to commercial scale.
How long will it take for America to produce enough synfuel to make a difference?
There are already a number of small plants being designed around America, but a large-scale national effort must involve the federal government and will take a number of years. Given South Africa's success in this field, we can assume that if the federal government became meaningfully invested in this concept, America could have a strong synfuel industry within the next decade."
We some time ago noted the MT governor's address on coal-derived synfuel/coal conversion at a Pittsburgh, PA, mining conference.
You, or someone, should give him a call. Montana's lignite just ain't as clean or BTU/carbon-dense as WV bituminous. It's easier to get at, and cheaper to mine, but it's also remote and has to be transported to places where people can actually use it. WV's a lot closer to NYC, Philly, DC, etc.
Why not West Virginia?
Called Sasol, YET?