Select Committee on Science and Technology Written Evidence


APPENDIX 30

Memorandum from Kenneth J Fergusson, President, Combustion Engineering Association

THE OPPORTUNITY FOR UNDERGROUND COAL GASIFICATION

  I am writing in a personal capacity, as President of the Combustion Engineering Association, and formerly Chief Executive of the Coal Authority. In 2001 and 2002, I acted as a consultant to DTI on matters to do with cleaner coal technology, and especially the comparison between advanced coal combustion processes (ultra-supercritical and oxyfuel) and gasification processes (IGCC) for future power generation. In 2002, I attended the IChemE European Gasification Conference in Noordwijk, NL, and then the US Gasification Technologies Council annual meeting in San Francisco, and prepared a synopsis on each. These were published as DTI reports.

  It is, in my view, essential for coal to continue to play a major part in the UK energy mix for decades to come, for reasons of security and cost. This argument, and support for the various processes, is being widely and convincingly expressed by many voices and, other than saying that I welcome this, it is not the main purpose of this letter to add to that debate.

  What I wish to do is to draw attention to the current lack of progress on the development in UK of underground coal gasification (UCG). It seems to have become an orphan, with no one speaking up in its support.

BACKGROUND

  In the 1970's, when I was in charge of the Technical Services Group of RTZ in London, we were aware, from our oil and gas exploration with Hamilton Bros, of the massive amounts of coal beneath the N. Sea, and were tantalised by how this energy resource might be tapped. Amongst the ideas considered was in-situ gasification. We concluded that this was the most promising technique and that, one day, it should become feasible, but that we were far ahead of the game, and the work was shelved.

  In 1997, I was recruited to the Coal Authority (CA) as Chief Executive, and became aware of the European trial of UCG at Teruel in Spain, in which UK was a participant. My Director of Licensing, Keith Leighfield, suggested to me that we in the CA should propose a follow-on, "semi-commercial" trial in UK. From my memories of our work in RTZ, I was keen on this and, over the period 1998-99, we obtained agreement from DTI and funding of £15 million over five years. Keith retired in 1999 but I continued to be evangelical on the case for UCG and delivered several lectures on the subject (ultimately the 50th Robens Coal Science lecture for BCURA in October 2001, just after my own retirement from the CA).

WORK BY THE COAL AUTHORITY

  An excellent start had been made, over more than a year, with the ongoing work on UCG. We held an international conference in London in January 2000, and UK was seen to be adopting a vigorous role in developing the process. We had several visits by overseas delegations to CA HQ in Mansfield, including a delegation from China.

  Then, without warning, we met a major obstacle, with the unsolicited opinion given by our QC that the project, being of the nature of promotion of the use of coal, was outside the statutory powers of the CA. He had formed this opinion, on reading about the work on UCG in our Annual Report. He advised that, as Chief Executive, I must stop expenditure on it immediately, as this was ultra vires. I took this advice with great frustration, the funding was returned to DTI, and our staff and consultants were transferred into DTI (or rather, to ETSU, now FES, at Harwell).

COMPLETION OF STUDIES FOR DTI

  The essence of our development programme still continued through these arrangements, but funding and ambitions were cut back to a series of desk studies, with no commitment to proceed to a semi-commercial demonstration. With my own retirement from the CA in July 2001, it is fair to say that the project lost its main protagonist. I had no direct part in the continuing work, although I was aware of progress, from occasional chance contacts with, in particular, the UCG consultant, Dr Michael Green, whom we had engaged in 1999, when his work as Project Manager for the UCG trial in Spain was completed.

  By mid 2003, the various studies were nearing completion, and DTI decided to prepare a report, to sum up and publicise the status of the work. An advisory committee was formed, which I was invited to join, the first meeting being on 30 July, 2003. In the following months, we reviewed the reports on the individual study areas and, early in 2004, moved on to the preparation of the draft report, the final version of which was agreed at the ultimate meeting of the committee on 27 April 2004.

DTI REPORT: "REVIEW OF THE FEASIBILITY OF UNDERGROUND COAL GASIFICATION IN THE UK"

  In October, 2004, with no further reference to the advisory committee, the report was published, (DTI/Pub URN 04/1643) but with one vital deletion. In the final draft, dated 20 April, there had been an Appendix 5, "Development Plan for UCG Development in the UK". (No doubt the repetition of "development" in this title would have been edited out.) It set out the topics, costs and timescales of the work which should be done over the next five years, to bring the process to a point where its viability could be judged by potential interested parties in the private sector. Without this appendix, and government support for the cost (of the order of £000,000's per year until a trial was to commence), it is unlikely that the work will proceed further in UK. I do not know the reasons for the deletion of this appendix, but it is extremely regrettable. Possibly it was seen as encouraging the ongoing use of coal for power supplies, and threatening to undermine the case for more renewables.

CARBON ABATEMENT TECHNOLOGY STRATEGY AND UCG

  The DTI document: "A Strategy for Developing Carbon Abatement Technologies for Fossil Fuels Use", DTI/Pub URN 05/944, published in June 2005, has a brief section, 6.5, on UCG. It mentions in the first sentence that ". . . the Cleaner Fossil Fuels Programme included an assessment of UCG". Alone in all the other references in this report to specific pieces of work, it does not cite the DTI report on UCG! Surely the reader should have been given the reference DTI Pub URN 04/1643? Further down, section 6.5 says: "This Strategy does not consider UCG as a specific CAT option to be pursued . . ." Why not? It cites other technologies such as usc pf and oxyfuel power stations as CAT's, which have limited potential national benefit, compared to the major contribution which successful development of UCG could make to achieving the national clean energy targets. I raised the case for UCG during the consultation on the CAT Strategy, and was told that it would be included. However, when the CAT paper was published, it, too, was lukewarm; I raised the above two points, but received no reply.

THE CASE FOR UCG DEVELOPMENT

  All of the conclusions of the report support the case for the UK, in possession of a vast unmineable coal resource, amounting to tens of billions of tons, or centuries of our TOTAL national energy demand, to continue to evaluate UCG, as the most likely means currently in sight to tap this domestic energy resource. China is engaged in such work, having contracted Michael Green as a consultant.

  Under UK conditions, it is predicted that UCG can produce power below the cost from imported LNG. Atmospheric environmental standards can match IGCC. CO2 can be captured from the synthesis gas at least cost, with the options of injecting into porous strata, or back into the combusted coal seams. This also puts the potential of UCG ahead of power generation from developed pf coal fired processes (ultra-supercritical or oxy-fuel).

KEY POINTS TO NOTE

    (1)  After the excellent progress over six years, no significant work on UCG is now underway in Britain.

    (2)  On the basis of the published report, and without dedicated government funding and active encouragement, it is unlikely that a private sector sponsor will take the initiative of proposing an ongoing programme.

    (3)  It would help, even at this point one year after publication of the report, if the deleted Appendix on the way ahead could be made public. This would allow potentially interested parties to judge the case for work to resume.

    (4)  The natural party for leading a resumption of work might be the Coal Authority. The legal obstacles to their playing such a role are still extant, but could be removed.

    (5)  The legal and regulatory framework within which UCG could operate under estuarine or coastal waters, and later offshore, in conjunction with CCS, needs to be the subject of attention now. This can only be done by the government.

    (6)  UCG with CCS is predicted to be able to make a major contribution to UK energy resources, carbon-neutral, with no foreign exchange penalty, at a price below the long-run cost of imported LNG.

    (7)  With this enormous potential national benefit, it is not, in my view, acceptable for government to adopt a so-called "neutral" approach and do nothing until an outside expression of interest has been received.

    (8)  The contention that the government is not in the business of "picking winners" is not tenable when, in the same month as the UCG report was published, and funding stopped, it was announced that £40 million or so was being made available to encourage development work on wave and tidal schemes, which can, at best, make only a minute contribution to energy supplies, in comparison to UCG.

  I have no "angle" on the promotion of UCG other than concern, in the national interest, with trying to bring the issue to wider public awareness and trying to get the stalled development programme re-started.

  I hope that this letter will be helpful to the Committee in its deliberations and that the subject of UCG will, at least, receive a positive mention in its findings.

November 2005





 
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