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The Untold Story Of The Dangerous New Experiment Coal Companies Want To Bring To America

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"The Untold Story Of The Dangerous New Experiment Coal Companies Want To Bring To America"

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The proposed UCG plant site in Wyoming.

The proposed UCG plant site in Wyoming.

CREDIT: Powder River Basin Resource Council

Few people have heard of coal gasification, which is the process of creating synthetic natural gas out of coal by setting it on fire and injecting it with oxygen and water. But even fewer people have likely heard of underground coal gasification, which is the process of doing that while the coal is still deep underground.

Some of the people that are hearing about it the most are in Campbell County, Wyoming, where an Australian company’s proposed underground coal gasification project is just one step away from becoming the only one of its kind in the country.

Local residents and environmental groups are fighting the project, saying it is an untested process that only promises to contaminate their already dwindling water supply with deadly benzene. If approved, the project — located in part of a major regional aquifer — would likely receive federal exemption from the Safe Water Drinking Act, a law that protects the quality of drinking water.

On Nov. 14, the Wyoming Environmental Quality Council will review Linc Energy’s application for a “state research and development” license to drill thousands of feet into Wyoming’s portion of the Powder River Basin. Unlike most areas where coal is accessible in a mountainside or somewhat near the surface of the ground, the coal targeted by Linc’s project is buried so deeply that regulated surface mining is impossible.

The UCG process is able to tap into that coal via a process that, according to a 2012 article in Forbes, “captures the imagination.”

[UCG] involves drilling two wells – at some distance from each other – into the coal seam. The first well supplies oxidants (a mixture of water and air or water and oxygen), which are injected into the location where the process is actually occurring. The second well permits the syngas produced to escape under pressure to the surface. This gas contains approximately 80% of the original energy content of the coal, and is a combination of hydrogen, carbon monoxide, carbon dioxide, and methane.

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UCG is largely an experimental process, but has been touted by coal companies as a clean coal technology that combats climate change by trapping underground most of the harmful gases emitted by regular coal burning. UCG plants only emit carbon dioxide, which according to a 2010 paper by UK’s Newcastle University, makes it perfect for pairing with carbon capture and storage (CCS). CCS is the process of capturing carbon dioxide emissions before they are emitted into the atmosphere and storing them deep underground.

If, however, UCG is not paired with CCS, it could result in massive carbon emissions, according to an article in The Bulletin of the Atomic Scientists. “If an additional 4 trillion tonnes [of coal] were extracted without the use of carbon capture or other mitigation technologies atmospheric carbon-dioxide levels could quadruple,” the article said, “resulting in a global mean temperature increase of between 5 and 10 degrees Celsius.”

Newcastle University’s paper advocated that UCG paired with CCS is a way to mitigate climate change effects from fossil fuel burning, but also noted that projects where coal seams were located next to prolific aquifers were extremely likely to experience groundwater contamination from benzene.

In fact, groundwater contamination from benzene is one of the main reasons that a UCG project has not happened in the United States in almost two decades. In the late 1970s, the U.S. Department of Energy conducted three pilot-scale test burns in Campbell County at a UCG project known as Hoe Creek, which caused benzene contamination in the area’s groundwater.

That contamination from the test burns allegedly cost the federal government $10 million and took 23 years to clean, according to a protest letter from a Wyoming family that lives near the proposed project. Linc’s proposed license is also for a test burn — the project would only go into commercial production if successful.

Following the Hoe Creek project, the EPA conducted a study in 1999 of so-called “in-situ” coal mining processes and concluded that “most, if not all, in-situ fossil fuel recovery operations initiated in the last 20 years appear to have caused some ground water contamination.”

The drilling for Linc’s proposed project would take place in the Fort Union Aquifer, which is frequently used to supply water for homes, ranches and municipalities. The portion of the aquifer that Linc wants to use for the project is currently not used for drinking water purposes, but The Powder River Basin Resource Council — the organization leading the protest of Linc’s application — has said the portion “contains good quality water that could be used as a future source of drinking or livestock water in the near future.”

The Wyoming State Climate Office pegs its state as the fifth driest in the nation, citing “a near decade with warm temperatures and relatively little precipitation [that] has left us very vulnerable.”

According to EPA representative Richard Mylott, Wyoming’s Environmental Quality Council will hear protests from citizens and environmental groups on Thursday and then decide whether it wants Linc’s project to be exempted from the federal safe drinking water law. The project must receive an exemption to proceed, Mylott said.

“If and when we receive an application for an aquifer exemption, EPA will thoroughly review technical information regarding resource production, extraction activity, and the adequacy of measures — both during and following production — to prevent the movement of contamination from the exempted production zone to underground sources of drinking water,” Mylott said, adding that EPA will also take public comments into consideration.

PRBRC attorney Shannon Anderson said companies have long coveted the too-deep-to-mine coal in Wyoming’s Powder River Basin — one of the most coal-rich areas of the country — but the EPA has never let any of the applications go through.

“The EPA has always told us that [UCG] is a non-starter, yet the company and state agency are moving ahead,” Anderson said. “I don’t know what’s happening behind the scenes, but I know there is a lot of political pressure from the company.”

Anderson went on to say that Linc, the Australian USG company that just recently pulled out of its Australia test project because of regulatory agencies stalling them, has hired Wyoming’s former governor David Freudenthal and former attorney general Bruce Salzburg to represent them in permit proceedings before the state environmental council. Both now work for Crowell & Moring LLP, an international law firm.

As the Democratic governor of the state, Freudenthal staunchly advocated for large federal investments in clean coal technologies, saying the federal government has been underestimating the need to pour money into CCS research, integrated gasification and studies of the liability. “No matter what we do, we’re going to be dealing with coal going forward,” Freudenthal has said.

Freudenthal still deals with coal in a big way. In addition to his counsel position at Crowell, he made $182,325 — $147,500 in cash and $34,825 in stock awards — in 2012 for serving on the board of Arch Coal, the second-largest coal company in the country. Fruedenthal still serves on the board, most recently buying 3,650 phantom securities from the company in October. In total, Freudenthal has bought 23,958 in Arch Coal securities at a current price of $4.11 per share, making his total direct interest in the company a little under $100,000.

As for Linc, the Australian company most recently decommissioned its UCG plant in Chinchilla, Australia, citing environmental roadblocks from the state government. Linc Energy CEO Peter Bond told ABC News that regulators in the company “have favored the coal seam gas industry and made it hard for UCG to establish itself.”

“We’re given a totally unfair and unreasonable deal,” Bond told ABC, adding that the company was not given a “reasonable opportunity for due process or even a fair go.”

Bond is now aiming to spin off the company’s coal business on the Singapore stock exchange.

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