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CTL Producer Enters into Long-Term Contract for Fischer-Tropsch Diesel Sales with Sinclair Oil

12 January 2007

Medicine Bow Fuel & Power LLC, a subsidiary of DKRW Advanced Fuels LLC, has entered into a long-term contract to sell 100% of the ultra-low-sulfur diesel fuel from its planned coal-to-liquids (CTL) facility in Medicine Bow, Wyoming, to Sinclair Oil Corporation, which will market the fuel in the Rocky Mountain region.

The planned Medicine Bow project, which includes a coal mine and adjacent CTL facility, will use GE’s coal gasification technology to produce syngas, which is then scrubbed of substantially all of the sulfur and carbon dioxide.

The syngas will then be liquefied using Fischer-Tropsch technology licensed from Rentech, Inc. A further refining process will produce the ultra-low-sulfur diesel product that is expected to exceed current environmental emission standards in the region. (Earlier post.)

Steam, tailgas and power produced from the CTL process will provide the necessary energy for internal CTL facility use with some surplus power sold to the utility grid.

The first phase of the Medicine Bow project is designed to produce approximately 13,000 bpd of refined liquids—primarily ultra-low-sulfur diesel and naphtha, which will be sold into the market. In addition to liquid fuels, a number of byproducts of the liquefaction process, including carbon dioxide and chemicals, are expected to be sold for use in the region. Carbon dioxide from the coal can be dried, liquefied and shipped via pipeline, and plans are to sell it to the enhanced oil recovery market in Wyoming with an initial target in the Powder River Basin.

We believe this agreement for the long-term supply of a Fischer-Tropsch, ultra-low-sulfur diesel product is the first of its kind. This contract is another important milestone in Advanced Fuels’ strategy to complete the financing and construction of our flagship project.

—Jon Doyle, DKRW Advanced Fuels’ chief operating officer

Construction of the CTL facility is scheduled to start in late 2007, with an expected in-service date in the fourth quarter of 2010.

DKRW Advanced Fuels is a development-stage hydrocarbon conversion company focused on the commercial development, construction, ownership and operation of facilities designed to convert lower-value hydrocarbons into products that traditionally have been produced from crude oil.

In addition to Medicine Bow, the company is pursuing projects in other parts of the US and exploring international opportunities. Shareholders include Arch Coal, the second-largest coal producer in the US, and Och-Ziff Capital Management, a New York-based private equity firm.

January 12, 2007 in Coal-to-Liquids (CTL) | Permalink | Comments (7) | TrackBack (0)

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Comments

The 'expected' scrubbed CO2 'can be' sold. I guess in the absence of any incentives we should expect it can be released to the atmosphere ie scrubbing omitted.

Too bad the states don't pass the requirement to use scrubbers since the Feds won't.

They might not be able to. You would be surprised at what the states can not do because Federal law and EPA trump them. However, when you have an administration that refuses to enforce the laws, you have problems.

As the admin was eight to say in order to regulate co2 your gona have to get congress to explicitly add it in to what the epa can handle because its a grey zone and that means lawsuits.

But congress even a dem controlled one wont pass such a bill because they dont want to be bl;amed for what MIGHT hap[en to peoples jobs and specialy UNION jobs if the epa did in fact contro, co2.

The gop sure as hell wont regulate it as they belive in tech no regulations and the dems wont do it because they depend on too many union jobs that would be nuked to high bleep if we did regulate it at anything other then a pathetic glacial pace;/

There are a HELL of alot of jobs riding on plants and factorues that WONT upgrade in the fce of co2 regs but instead simple close down SPECIALY in a cap and trade econ where its PROFUITABLE to close and sell off your co2 credits but no here near profitable to kep the plant running in the usa... wich describes about 95% of the plants and factories in the us.

This CTL project and others like it will help our nation become more energy independent. If we built more nuclear power plants (10 are already in the planing stage) they can replace some or maybe all of the coal used to power electrical plants now. Here are the big GHG reductions some of you are looking for. This 1 billion ton per year coal supply will then be available for the CTL process. Anyhow, this is what big business are spending their money on! http://www.ultracleanfuels.com/

Sasol, Syntroleum...there are several F/T companies. Once you can make synthesis gas from coal or biomass you can to this. I read that to make ethanol from syngas they use part of an F/T process. Methanol is a bit easier and SNG is easier yet. So it looks like producer gas, synthesis gas, SNG or methanol, ethanol, gasoline, kerosene or diesel. This is possible and once it becomes cost effective, away we go!

We are also looking into CTL plant in Pensylvania, We need some assistance, pls suggest where to approach.

Thank you

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