By GREGORY R. NORFLEET
MT. VERNON — A coal mine company will announce by year’s end that it will open a mine and provide coal for a planned gasification plant, according to the president of Power Holdings of Illinois.
Power Holdings President Bob Gilman made the announcement at a press conference Thursday where the state promised $3 million to the company’s Waltonville project — $2.5 million for design engineering studies and $500,000 for preliminary design and engineering work.
Gilman said the company is in talks with one group primarily to open a mine next door to the plant, feeding coal right into its high-tech processors. If talks fail with the first group, another company has expressed interest in opening a mine, he said.
Without a coal mine, the coal gasification plant could not break ground as soon as planned for the hopefully 2010 opening, but Gilman was confident a coal mine will open in conjunction with the plant.
Gilman said the company “chatted” with companies which still own some of the mines which closed throughout Southern Illinois largely due to the Clean Air Act. In those conversations it was deemed less expensive to open a new mine than reopen an old one.
“They’ve mined out the cheap coal,” he said, saying what is left is a mixture of rock and coal that is expensive to separate.
The state funding, which was announced by Jack Lavin, director of the Illinois Department of Commerce and Economic Development, will help Power Holdings with $7 million in preliminary design and engineering and $25 million in design engineering studies.
The plant will use technology designed for “Illinois coal” — with its high-sulfur content — and capture “99.9 percent” of the coal’s sulfur and turn it into synthetic natural gas.
“That is a phenomenal achievement,” Gilman said of the technology.
The process also captures 90 percent of the carbon dioxide and stores it underground with “virtually no mercury emissions,” he said.
Power Holdings has secured $1.6 billion in contracts with Ameren, Nicor and Oneok Energy Services Co. to buy all of its SNG once the plant begins output.
“And you can bet that Oneok wouldn’t have signed on for that last third if Ameren and Nicor hadn’t ponied up,” he said.
Evan Sink, coal industry liaison for the United Mine Workers of America, said the union organizing group will actively help the expected coal mine to find qualified workers, from welders to chemists to engineers and, of course, miners.
“This is going to be a booming effect in our area,” he said.
Constructing the coal gasification plant is expected to create 1,200 jobs, and running it is expected to create 200 jobs. A coal mine producing 4 million tons a year would need about 400 workers, Gilman said.
By GREGORY R. NORFLEET
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