An Update on Lignite Research and An Update on Lignite Research and the Status of the Lignite Resources the Status of the Lignite Resources Pil t Pr Pil t Pr Pilot Program in Arkansas Pilot Program in Arkansas r m in Ark n r m in Ark n Ed Ratchford Ed Ratchford Senior Petroleum Geologist Senior Petroleum Geologist g Arkansas Geological Survey Arkansas Geological Survey Arkansas State Capitol Arkansas State Capitol Joint Committee on Energy Joint Committee on Energy Joint Committee on Energy Joint Committee on Energy August 4, 2008 August 4, 2008
Outline Outline � Objectives and current status of the Objectives and current status of the Arkansas Arkansas Lignite Resources Pilot Program Lignite Resources Pilot Program � Status of funding for the Energy & Status of funding for the Energy & Environmental Research Center Grant Proposal Environmental Research Center Grant Proposal Environmental Research Center Grant Proposal Environmental Research Center Grant Proposal No. 2008 No. 2008- -002 002 � AGS update on geologic modeling of industry AGS update on geologic modeling of industry data associated with Arkansas’ lignite deposits data associated with Arkansas’ lignite deposits � Observations & Recommendations Observations & Recommendations
Lignite Resources Pilot Program Lignite Resources Pilot Program � Act 641, Regular Session 2007, created the Act 641, Regular Session 2007, created the “ Arkansas Lignite Resources Pilot Program Arkansas Lignite Resources Pilot Program” Arkansas Lignite Resources Pilot Program Arkansas Lignite Resources Pilot Program � Primary Objective: “to develop an energy Primary Objective: “to develop an energy utilization strategy for Lignite production and utilization strategy for Lignite production and use” use” � “ The Lignite Pilot Program shall be developed “ The Lignite Pilot Program shall be developed and administered by Southern Arkansas and administered by Southern Arkansas and administered by Southern Arkansas and administered by Southern Arkansas University, the Arkansas Geological Survey, and University, the Arkansas Geological Survey, and the Arkansas Department of Economic the Arkansas Department of Economic the Arkansas Department of Economic the Arkansas Department of Economic Development” Development”
Key Aspects of the Legislation (Act 641) Key Aspects of the Legislation (Act 641) � Excerpts: Excerpts: � “Explore and utilize lignite as an energy resource � Explore and utilize lignite as an energy resource “Explore and utilize lignite as an energy resource Explore and utilize lignite as an energy resource including without limitation a Synfuels including without limitation a Synfuels- -based based research program research program research program” research program” � “Develop public and private partnerships with “Develop public and private partnerships with other entities to develop the untapped energy other entities to develop the untapped energy resource of lignite to stimulate Arkansas’ resource of lignite to stimulate Arkansas’ economy” economy” y � “Develop practical applications for the use of � “Develop practical applications for the use of “Develop practical applications for the use of “Develop practical applications for the use of lignite resources as an alternative energy source” lignite resources as an alternative energy source”
Key Aspects of the Legislation (Act 641) Key Aspects of the Legislation (Act 641) � Excerpts: Excerpts: � “The Arkansas Lignite Resources Pilot Program � The Arkansas Lignite Resources Pilot Program “The Arkansas Lignite Resources Pilot Program The Arkansas Lignite Resources Pilot Program may participate in federal, state, or industry grant may participate in federal, state, or industry grant opportunities that are available for the program opportunities that are available for the program opportunities that are available for the program” opportunities that are available for the program” � “ Representatives from Southern Arkansas “ R R Representatives from Southern Arkansas i i f f S S h h A k A k University, the Arkansas Geological Survey and the University, the Arkansas Geological Survey and the A k Arkansas Department of Economic Development Arkansas Department of Economic Development A k D D f E f E i D i D l l shall report the status of the Arkansas Lignite shall report the status of the Arkansas Lignite R R Resources Pilot Program periodically to the Resources Pilot Program periodically to the Pil Pil P P i di i di ll ll h h Legislative Council and the Joint Committee on Legislative Council and the Joint Committee on E E Energy” Energy” ” ”
Products Generated From Lignite Products Generated From Lignite � Electricity El El Electricity -- i i i i -- Primary or Secondary Fuel Source for Primary or Secondary Fuel Source for P i P i S S d d F F l S l S f f Power Plants Power Plants � Gasoline Gasoline � Diesel Diesel � Synthetic Natural Gas Synthetic Natural Gas � Liquid Petroleum Gas (LPG) � Liquid Petroleum Gas (LPG) Liquid Petroleum Gas (LPG) Liquid Petroleum Gas (LPG) � Methanol Methanol � Ethanol Ethanol � Phenol Phenol � Ammonium Sulfate Ammonium Sulfate � Anhydrous Ammonium � Anhydrous Ammonium Anhydrous Ammonium Anhydrous Ammonium � Additional Economic Bi Additional Economic Bi- -Products Products
Overview of the EERC Grant Proposal Overview of the EERC Grant Proposal p � In July 2007, the AGS received a research grant In July 2007, the AGS received a research grant proposal from the EERC This proposal proposal from the EERC This proposal proposal from the EERC. This proposal proposal from the EERC. This proposal specifies the required steps for the commercial specifies the required steps for the commercial testing of Arkansas’ lignite resources t t testing of Arkansas’ lignite resources ti ti f A k f A k ’ li ’ li it it � The EERC proposal provides $550,000 in The EERC proposal provides $550,000 in matching federal funds from the Department of matching federal funds from the Department of matching federal funds from the Department of matching federal funds from the Department of Energy Energy
Near Surface Lignite Project Near Surface Lignite Project
Primary Objectives of the EERC Proposal Primary Objectives of the EERC Proposal � St � Step 1: Secure 75 St Step 1: Secure 75-100 drill cores from the AGS for 1 S 1 S 75 75 100 d ill 100 drill cores from the AGS for 100 d ill f f th AGS f th AGS f the commercial testing of south Arkansas lignite the commercial testing of south Arkansas lignite � Step 2: Gasification testing of lignite to assess � Step 2: Gasification testing of lignite to assess Step 2: Gasification testing of lignite to assess Step 2: Gasification testing of lignite to assess the quality of the fuel for electrical power the quality of the fuel for electrical power generation (IGCC Technology) generation (IGCC Technology) i i (IGCC T (IGCC T h h l l ) )
Primary Objectives of the EERC Proposal Primary Objectives of the EERC Proposal � Step 3: Synfuels testing of lignite to assess the � Step 3: Synfuels testing of lignite to assess the Step 3: Synfuels testing of lignite to assess the Step 3: Synfuels testing of lignite to assess the quality and characteristics of lignite for liquid quality and characteristics of lignite for liquid f f fuels production (i.e. gasoline, diesel etc.) fuels production (i.e. gasoline, diesel etc.) l l d d i i (i (i li li di di l l ) ) � Step 4: Final Report submitted to the Lignite Step 4: Final Report submitted to the Lignite Resources Pilot Program detailing the test Resources Pilot Program detailing the test Resources Pilot Program detailing the test Resources Pilot Program detailing the test results and enumerating several development results and enumerating several development pathways based on Arkansas’ infrastructure and pathways based on Arkansas’ infrastructure and proximity to markets proximity to markets
Coal Coal- -To To- -Electricity By IGCC Electricity By IGCC
Coal Coal- -To To- -Liquid Transportation Liquid Transportation
Great Plains Synfuels Plant Great Plains Synfuels Plant - - North North Dakota Dakota
Status of Funding for the EERC Proposal Status of Funding for the EERC Proposal � The EERC research proposal was submitted to the The EERC research proposal was submitted to the AGS on 7 AGS on 7- -3 3- -2007 and no decision has been made by 2007 and no decision has been made by y the State of Arkansas regarding the funding of this the State of Arkansas regarding the funding of this project project � The State has a window of time to respond to the The State has a window of time to respond to the p proposal or the $550,000 in federal matching funds will proposal or the $550,000 in federal matching funds will be lost be lost � The AGS believes that funding of this project is The AGS believes that funding of this project is g g p p j j prudent given the fact that the lignite resource is large, prudent given the fact that the lignite resource is large, undeveloped, and that energy prices continue to undeveloped, and that energy prices continue to increase increase
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