(EnergyAsia, September 14 2011, Wednesday) — Solid Energy New Zealand (SENZ) said it has begun constructing a commercial-scale demonstration plant using GTL Energy Ltd’s proprietary coal upgrading process and equipment.

SENZ is due to start up the first phase of its plant at Mataura by mid-2012 producing up to 90,000 tonnes a year of low-moisture and higher-energy briquettes from about 150,000 tonnes of lignite Adsensemined from its New Vale opencast mine in New Zealand.

GTLE and SENZ said they have worked closely for years to determine the best means of upgrading the lignite resource.

In June, they announced that they had signed a licensing agreement and contracts for the design and construction of the Mataura plant after they had completed briquette testing and upgraded bulk quantities of coal at GTLE’s plant in North Dakota in the US.

GTL Energy CEO, Fred Schulte, said:

“This is a major step forward in realising the commercial value of our unique technology for conversion of low-grade coal to higher rank fuel and for New Zealand in unlocking the value potential in deposits of lignite coal in Southland. The SENZ choice of GTLE’s proprietary process and equipment represents a substantial vote of confidence in the technology and its readiness for commercial deployment.”

SENZ will make a decision on expanding the Mataura plant if its initial phase is deemed to have met their objectives of producing low-moisture, higher-energy briquettes for the New Zealand and international markets.

Mr Schulte said: “Our unique and proprietary coal upgrading process (coal drying / beneficiation) removes moisture from low rank coals to produce low moisture, high energy and mechanically strong briquettes without binders and without creation of environmentally hazardous waste streams.

“The technology improves the efficiency of low rank coals ensuring a reduction in emissions including carbon dioxide and volatiles, as well as increasing the market value of low rank fuels.

“Our capability to demonstrate performance on bulk quantities of raw material using commercial scale equipment at our North Dakota plant has clearly proven to be advantageous to GTLE and its potential clients.

“Processing of bulk quantities of a range of low rank coals from around the world at this plant has shown that their moisture content has been reduced by an average of 65%, increasing their energy content by 40-50%.

“Additionally, our modular approach to design and construction provides flexibility, allowing it to be deployed cost-effectively at a commercial scale without the risks frequently associated with scale-up.”

Last June, GTLE commissioned its North Dakota plant, which was designed as a single module commercial scale plant to demonstrate the effectiveness of its technology and the capabilities of processing equipment to coal consumers and producers around the world.

Established in Australia, GTL Energy developed its coal upgrading technology at its pilot plant in Colorado, US and its commercial scale demonstration plant in North Dakota.  The company has focused on researching and developing technology to convert low-grade coal into higher-rank fuel by removing moisture and converting the product into briquettes which feature higher energy content, reduced emissions, improved handling and transportation characteristics and increased market value.

As New Zealand’s largest coal miner, Solid Energy produces coking, thermal and specialist coals. The company is working on projects to upgrade its vast South Island lignite deposits.