A world leader focussed on transforming stranded coal resources into high-value, low carbon-emitting fuels, Carbon Energy has achieved ‘proof of concept’ for its proprietary Keyseam technology.
Keyseam is an innovation in underground coal gasification (UCG) technology incorporating a unique site selection methodology and advanced geological and hydrological modelling. Following 10 years of research by CSIRO, Carbon Energy invested fi ve years and about $100 million in developing the technology. According to Carbon Energy, Keyseam maximises resource efficiency by extracting up to 20 times more energy than CSG, from the same resource, while minimising surface disturbance and preserving groundwater quality.
To reach proof of concept, the company has tested its technology with: more than three years of in-fi eld UCG demonstration and operation; 12 months continuous production of consistently high-quality syngas; reliable
operation of internal combustion engine driven electricity generators; and reliable export of electricity to the local grid from its Bloodwood Creek project site, near Dalby in South West Queensland. Following its achievement of proof of concept, Carbon Energy has undertaken a review to determine the company’s strategic direction. It reported in a media announcement that its plans involve actively pursuing commercial scale projects with coal owners and energy end users (including electricity, chemicals and liquids) in Australia and offshore, in addition to developing its current projects in Chile, North America and Europe.
“We have proven our Keyseam technology works and are more committed than ever to commercially applying our UCG technology. We are best placed to do this by partnering with coal resource owners and energy users,” Carbon Energy managing director Andrew Dash said in the announcement. The company also plans to maximise the value of its two signifi cant resources in Queensland. According to Carbon Energy, its existing 29 square kilometre UCG licensed area at Bloodwood Creek has a 2P resource of 743 petajoules of syngas, which is equivalent to Brisbane’s entire gas supply for more than 15 years.
The company’s current tenure allows for the demonstration of multiple UCG panels and the production of up to 30 megawatts of electricity. A mining lease application, which will allow for full commercial production, has
been submitted for about half of the area. The company also holds about 1400sqkm of thermal coal leases surrounding Bloodwood Creek, for which it has planned a 12-month work program that includes exploration drilling and scoping and feasibility studies. This program aims to evaluate value-generating options in order to fund the development of the Keyseam technology. Carbon Energy reported in an ASX release that it had engaged a third party resource consultant to independently assess the additional coal resources contained in the leases. Results of the work are expected by the end of the financial year.
As a result of its strategic review, Carbon Energy also announced that costs at the Bloodwood Creek project site will be reduced until a commercial agreement with a partner is reached and regulatory certainty is achieved. The company stated in an ASX release that planned cost reduction activities included suspension of the 1.5MW power station trial.
The shutdown and progressive rehabilitation of UCG Panel 1 is currently underway to demonstrate the completion of the full life cycle of a UCG panel. Carbon Energy also reported that UCG Panel 2 would be shut in and maintained in a state from which it could be recommissioned. As a result of the cost reduction activities, staffing requirements would also be revised.
By Danica Newnham