Synthesis Energy Systems in JV to Evaluate CTL Project in Mississippi

16 July 2008

Synthesis Energy Systems, Inc. (SES) and The North American Coal Corporation (NAC) are conducting a joint pre-feasibility study to explore the development of a coal-based gasification facility utilizing SES’s proprietary U-GAS(R) technology. If constructed, the facility will produce synthetic gasoline, chemical feedstocks and/or synthetic natural gas.

The location for the study is NAC’s Red Hills Mine Operations near Ackerman, Mississippi. Following the completion of the pre-feasibility study, the companies will determine if they will engage in a front-end engineering design study to further develop the opportunity.

This joint development agreement will be in addition to SES’s on-going development work with Consol Energy in the US (earlier post), and Hai Hua, Golden Concord and YIMA in China. (Earlier post.)

With 2.3 billion tons of lignite coal reserves, NAC is the US’ largest miner of lignite coal, and the eighth-largest coal producer nationwide, delivering 33.7 million tons of lignite coal in 2007. Lignite is a high-ash and high-moisture feedstock that is abundant throughout the southern states, in addition to other areas in the United States.

SES owns an exclusive global license for U-GAS gasification technology that has been developed over the past 30 years by the Gas Technology Institute, and can efficiently convert low-rank lignite coals into high value commodity products such as synthetic gasoline and synthetic natural gas.