Coal big hope for N.Z.'s fuel in the 1990s

Press, 22 September 1980, Page 1

Coal big hope for N.Z.'s fuel in the 1990s

From KEN COATES in London

New Zealand could be up to 80 per cent self-sufficient in liquid fuels in the 1990 s by using new technologies to develop its coal resources.

The Minister of Energy (Mr Birch) sees the key being technologies to convert a synthetic gas from coal into a fuel for jet and diesel engines.

Mr Birch, who had been in West Germany studying the latest developments in the use of coal as an energy source, said New Zealand would be 50 per cent self-sufficient in transport fuels by 1986. But already the Government had spent about $5 million on conceptual proposals and investigations for using the large South Island coal resources. Shell and Rheinbraun, of Germany, were working on one proposal which would convert the coal first to gas and then to liquid fuel. Mr Birch visited a pilot plant in Hamburg producing 150 tonnes a day using the “ShellKopper" process. The Minister also looked at extraction methods in a large opencast mine, 300 metres, deep and 20 kilometres square, near Co* logne, producing 42 million tonnes a year. After studying Rheinbraim’s farmland restoration methods and measures taken to safeguard the environment, Mr Birch said he was sure similar adequate measures could be taken in New Zealand. While the Shell-Kopper process could be applied to the lignite deposits in Southland and Central Otago, other oil companies were working on different techniques aimed at extracting liquid fuels from coal. In addition, New Zealand faced a great deal more investigative work into the nature of its coal reserves — their extent, amount of overburden, lo-

cation of seams, water content, and quality. The Liquid Fuels Trust Board would spend $3 million over the next three years on this programme of analysis which would involve overseas expertise. During this time the new technology being pioneered in Hamburg, which was not yet ready to be applied to commercial production, could be developed further. A new plant handling 1000 tonnes of coal a day was to be built in the Netherlands, and would be semi-commercial. On the cost of fuel produced by this method, Mr Birch said: “Indications are that jet and diesel fuels will not be very different. in price from those being paid for them today.” At this stage, “conceptual” proposals were that a $2 billion plant producing 30.000 barrels a day would lift New Zealand’s self-sufficiency to between 70 and 80 per cent. “We want to be in a position, about 1984, to decide whether to invite firm proposals allowing

for liquid fuels to come on stream from coal in the 19905,” Mr Birch said. While the coal reserves were being investigated further, other technologies would also be examined — notably hydrogenation, whereby coal was transformed directly to a liquid fuel.

Mr Birch is optimistic about the availability of overseas capital to fund much of New Zealand’s energy programme..-. He. attended ;7>ah investment seminar in Hamburg arranged by Commerz and Warburg Banks, and attended by 50 leading bankers and businessmen. There was keen interest in prospects for development in New Zealand, and the possibility of joint ventures.

The West Germans were confident alcohol fuel and methanol have an important role to play. Volkswagen has agreed to send to New Zealand a car with a specially designed engine from Brazil and will consider sending a second car with an engine designed for alcohol from Germany.