Coal Gasification : A PRB

Overview
Mark Davies – Kennecott Energy
Outline
• Background – Our Interest
• History – Development of IGCC
• Current status – Commercial Technology
• Poly generation - Synthetic Fuels
• Issues for PRB
• The Future
• Questions ???
Our Interest - Sustainable Development
“development that meets the needs of the present
generation without undermining the capacity of future
generations to meet their needs.”


Rio Tinto’s commitment to SD: Ensure our
businesses,operations and products contribute to
the global transition to sustainable development
Coal’s Sustainability Challenge
• Economic and social criteria make a compelling case for coal –
the issue is environmental performance

• Climate change concerns present a complex challenge for the
continuing use of fossil fuels and coal in particular
Integrated Gasification Combined Cycle (IGCC)
Twenty years ago oil refinery practice in North America and Europe
underwent a fundamental change as available crude became heavier

This had two implications:
• A significant increase in hydrogen demand to 'sweeten' the
heavier crude; and
• Increased production of highly contaminated petcoke and heavy
refinery residues

Simultaneously, aerospace technology was being applied to the utility
sector to create natural gas fired turbines; and coal based IGCC
started becoming a viable technology
IGCC is essentially ready for use by the coal industry, which
has largely been spared the expense of its development
Implication – Current commercial technologies were developed for
Petcoke
• Natural gas
• Gas turbine
• Heat recovery steam
generator
• Steam turbine
• High efficiency
• Low capital
• Simple vs. PC plants
• Cookie-cutter design
• Low emissions

Natural Gas Combined Cycle (NGCC)
Integrated Gasification Combined Cycle (IGCC)
Gasification is essentially partial oxidation under pressure
IGCC + Carbon Capture and Storage
Current Commercial Technology
• Slurry feed
• Refectory lined
• Quench available
• Not PRB capable
• Slurry feed
• Refectory lined
• 2 Stage
• ???
• Lock hopper feed
• Water cooled
• Syngas cooler
• PRB capable
at cost
Shell GE (Chevron Texaco)
ConocoPhillips (E-Gas)
Impact of Coal Type
1.00
1.05
1.10
1.15
1.20
1.25
1.30
1.35
1.40
5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,000 13,000 14,000 15,000
Coal Heating Value, Btu/lb HHV
R
e
l
a
t
i
v
e

H
e
a
t

R
a
t
e

o
r

C
a
p
i
t
a
l

C
o
s
t
IGCC Capital Cost (E-Gas)
IGCC Heat Rate (E-Gas)
PC Capital Cost
PC Heat Rate
WY PRB
TX Lignite
Illinois #6
Pittsburgh #8
Source: EPRI
• Any coal or biomass feedstock can be gasified
• The issue is the economics!
• Gasification is most efficient with low moisture, low ash
and high heating value feedstock's
Issues for PRB
Indicative Cost of Electricity
0 5 10 15 20 25 30 35 40
Illinois coal
PRB Coal
C
o
a
l
Cost ($/MWhr)
Capital Cost ($/MWh)
Other Fixed Costs ($/MWh)
Fuel Expense ($/MWh)
Variable O&M ($/MWh)
• Capital cost disadvantage may be mitigated by fuel cost
• Petcoke/PRB blends can be attractive
• New technology
• DOE/Southern Transport Reactor
• Alternate slurry technology
• Commercial vendors have little ongoing development
Polygeneration
Syngas is a prime petrochemical feedstock

Traditionally produced by
reforming natural gas

“Natural gas” from Syngas
• Methane reformer
• CO + 2H
2
+ Catalyst
=> CH
4
+ clean up

Liquid chemicals from Syngas
• Clean diesels
• Methanol

Indicative breakeven – current
technology
• Liquid Fuels $30 - $35 bbl
• Synthetic natural gas - $5.50 - $7 /MBTU*

* Source – DOE
IGCC + CCS + Poly generation
Barriers to IGCC Commercial Deployment
• Cost → 10-20% penalty for bituminous coal
• Traditional PC can meet current environmental standards
• IGCC financing costs higher than PC – perceived risk
profile
• No reward for risk taking – new plants largely being built
by regulated utilities
• Excess capacity in many regions - NGCC overbuild
• IGCC needs more project development than NGCC or PC
• To date no standard IGCC design - this will change with GE
entry
• Lack of familiarity with IGCC in the power industry (it is a
chemical plant)
Future Issues
• Environmental regulation, community pressure, uncertainty
– particularly carbon
• Sustained Federal research effort to resolve cost, reliability
concerns
• Especially on low-rank coals
• Critical to establish viability and acceptability of carbon
capture and storage
• e.g. FutureGen
• Development of of integrated, optimized designs
• GE/Bechtel
• ConocoPhillips/Fluor
• Deployment incentives to overcome commercial penalty
(e.g. incentives, production tax credits, etc)
• Costs should come down as new plants are built and
improved designs become standard

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