Australian UCG-GTL Issues

Scopy Study Findings from Liberty Resources Ltd

Liberty Resources Limited (ASX:LBY) recently completed a scoping study which has validated the economics of a UCG syngass project in Queensland's Denison Trough.

"The positive results from the study were based on 19,783 PJ of recoverable syngas produced at a cost of $1.79/GJ. Assuming $3.00/GJ sale price for syngas, the model shows Project revenues exceeding A$59 billion.  Further studies are being completed on the Denison and elsewhere.

Syngas Project Operating Cashflow has been estimated at $24 billion using a 25.3 GJ/tonne Coal Heating Value (HV) and $11.8billion using 20GJ/tonne HV. Both are considered more than adequate to cover future capital and development costs."
  View the Report.

The Editors of UCG-GTL are really excited by this report as it shows that if the Queensland Government changes its mind about burning coal underground to make gas (UCG) then Liberty will have a massive amount of energy in the form of syngas. Syngas can be converted to a great many number of valuable products which you can view here.

In essence, if Liberty can burn their coal underground (UCG) it means that 1 ton of coal will produce enough gas to make 1.5 barrels of oil at a cost of around $30. This price is very desirable considering the price of Gulf of Mexico oil production costs of  around $45-60 dollars. Liberty can also use the gas to make LNG or drive power stations etc. much more cleanly than the coal fired stations.

Furthermore we would like to draw attention to the fact that UCG extracts around 98% of the coal's energy whereas Coal Seam Methane (CSM) Gas extracts only 5% of energy leaving 95% behind. This might mean a huge wake up call to our state government who are in the middle of building a CSM-LNG gas industry that will hopefully earn us billions of export dollars. But imagine the untold riches that an integrated UCG / UCG-GTL/ UCTL industry could bring to us. Governments rarely do well picking winners and in our opinion they have failed us with their restrictions on UCG.

To view the report from Liberty Resources Ltd click here.

Overlapping CSG and UCG Tenements in Queensland
By Nick Leonard

In recent years, Queensland has cultivated a coal-seam gas (CSG) industry, developing a few of the fastest growing companies on the ASX, such as Queensland Gas Corporation and Arrow Energy. Syngas (synthetic gas) production via underground coal-seam gasification (UCG) is an emerging method of extracting gas from coal-seams and is increasing competition for reserves in the region. As licences are granted and petroleum, gas and various mineral resources are acquired by companies, the issue of overlapping tenements becomes more apparent. UCG, CSG and minerals extraction can potentially operate at the single geographic location but at different depths and on different tenements. This issue paper will explore Queensland‟s legislation on overlapping tenements and the current state-of-play of its effects on the Queensland gas industry. Read full article

Environmental Issues in Underground Coal Gasification
Only 2 of over 30 UCG U.S. trials resulted in environmental contamination

Queensland's Underground Coal Gasification Policy
The Queensland government's policy on underground coal gasification (UCG) was announced on Wednesday 18 February 2009. The policy provides for a UCG pilot phase over the coming years to gather the necessary information to assess the future viability of a prospective UCG industry in the State.

A Comparision of UCG Technologies for Deep Deposits and Mined Deposits
Underground coal gasification (UCG) developments in China and the UK. To examine UCG site selection constraints and environmental issues

UCG Engineering Ltd
Specialists in Underground Coal Gasification

U.S. National Coal Council
The National Coal Council has compiled over 30 reports at the Secretary’s request on numerous issues affecting coal and U.S. energy policy.

Did Anna Bligh get it wrong or very wrong when she chose Coal Seam Methane over UCG?
This ( is why we were so vociferous about the Bligh Govt. choosing CSM over UCG.


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