Australian company LINC Energy pulls the plug on flagship underground coal gasification (UCG) project

The Australian company LINC Energy has pulled the plug on its former flagship underground coal gasification (UCG) project, blamingĀ  the Queensland government.

UCG involves igniting coal in the ground, then collecting and using the gases that result from the partial combustion.

Recently a scientific panel recommended that the Queensland State Government delay allowing two UCG operations to develop on a commercial scale.

The committee wanted to see evidence that the combustion process (of the underground coal) could be safely drawn to a close and that there was no issues associated with that. The State Government had already shut down a third project at Kingaroy operated by Cougar Energy, in response to contamination.

Linc chief executive Peter Bond said the company had spent more than $200 million on studies and test work at the Chinchilla UCG project but would now walk away. The facilities at Chinchilla will be taken apart and exported to Linc’s UCG projects overseas.

LINC Energy’s trial’s in Australia have been used globally by the UCG industry to justify claims of safety and efficacy and support the industry’s expansion into UK and Asia.

UCG produces large amounts of CO2, and the coal combustion wastes are simply left behind and can leach pollutants into nearby groundwater. The wastes from burning coal underground contain a variety of toxic compounds such as arsenic, cadmium, chromium, cobalt, lead, mercury, selenium, thorium and uranium, as well as dioxins and poly-aromatic hydrocarbons (PAHs). The vast empty areas once the coal is burnt underground may also result in severe subsidence.

The other UCG company involved, Carbon Energy responded to the State Government’s announcement by calling a trading halt. As of November 15th their shares are worth 2 cents.

Posted on: November 15, 2013