Now, The Age reports that the state of Victoria is about to grant a mining licence to the project, which also has the backing of Shell and parent Anglo American.

Location of the project. Click to enlarge.

The brown coal fuel source and proposed processing facilities are located in the Latrobe Valley, 200km to the east of Melbourne, Australia. The area being examined for CO₂ injection and storage is in the depleting oil and gas fields of the offshore Gippsland Basin.

The Latrobe Valley’s brown coal has a moisture content of more than 60%. Vaporizing this moisture when the coal is utilized for power generation results in a process energy loss that also reduces the electricity generated per unit of CO₂ emitted.

Conventional electricity generation technologies produce roughly 50% more CO₂ per unit of electricity from utilizing this brown coal than they do from black coal, according to Monash. Consequently the Latrobe Valley produces more than 60 million tonnes of CO2 per year, or roughly 15% of Australia’s total.

Unless a solution can be found to the CO₂ emissions associated with conventional utilization of brown coal, there would be very little scope to replace the regions power stations when they reach the end of their operating lives.

—Monash report to the House of Representatives

The first stage commercial plant in the Monash Project is being designed to produce about 60,000 bpd of synthetic hydrocarbon liquids of which 80% would be ultra low-sulfur high-quality automotive diesel. Commissioning of the plant is targeted for 2016.

While the initial focus in on F-T liquid fuels, ultimately Monash sees the project producing hydrogen to support the longer term development of a hydrogen economy.

The Project will compress approximately 13 million tonnes of super-critical CO₂ per year, for transport via pipeline to store offshore beneath the depleting oilfields.

A study in 2005, initiated by Monash Energy and funded by the Australian Government, confirmed the potential for the offshore Gippsland Basin to provide secure, low-cost storage for at least 50 million tonnes per year of carbon dioxide.

The carbon capture and sequestration (CCS) component of the project will utilise proven petroleum industry technologies—compression, pipelines, offshore pipelines and injection wells— to inject the CO₂ into geological reservoir formations at a depth of approximately 3 km.

The developing technologies associated with CCS relate mainly to the modelling, monitoring and verification techniques used to track the injected CO₂, and to the materials and techniques used to ensure that petroleum and injection wells are adequately engineered for CO₂ containment, according to Monash.

The output from the Monash Energy plant has an indicative price of $US50/barrel. The Gippsland Basin brown coal resource is sufficient to support several such plants, each operating for 50 years, as well as low emissions electricity and future hydrogen production facilities, according to the company.

Resources:

• Monash Energy Project Submissions to House of Representatives on Geosequestration

• Carbon Dioxide Capture and Storage (IPCC)