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ERDA intends that the design and inspection costs for the project will be fully borne by the Government. Construction costs are anticipated to be shared by industry and the Government. The Federal Government's share of the total project including design, is estimated by ERDA at $91,000,000 and the industry share is estimated at $75,000,000.

(2) Coal high Btu gasification.—

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The Interior Committee recommends a shift in funding from "operating expenses" of the high-Btu gasification sub-program to a capital account so that seed monies will be available to begin construction of a high-Btu gasification demonstration plant (additional discussion of the proposed demonstration plant below).

Natural gas demand has exceeded the current rate of discovery on new sources. Development of high-Btu gas would provide alternative energy sources equal in quality to natural gas. The ERDA budget reflects a shift in emphasis away from high-Btu gas to low-Btu gas and liquefaction research and development; for FY 1976, the budget request is $15 million below the current fiscal year for high-Btu gasification.

High-Btu Gasification is the chemical transformation of solid coal into gas. This gas, composed essentially of methane, is virtually free of sulfur, contains no carbon monoxide, or free hydrogen, and has a heating value of about 1000 Btu/ft.3

This substitute for natural gas is manufactured from coal by producing a synthesis gas and treating it by purification and catalytic methanation. A typical process begins with coal preparation, in which coal is ground to a powder. Pretreatment with air or oxygen destroys the caking property, which otherwise causes some coals upon heating to swell and plug the reactor. In the gasification process, synthesis gas is formed when steam and oxygen react with coal. This gas contains varying amounts of carbon monoxide, hydrogen, and methane as valuable components. Carbon dioxide, sulfur compounds, and other impurities must be removed in further processing.

Activities will continue on a cooperative and jointly funded effort of industry-government to develop processes aimed at improving the nation's natural gas resources by producing substitute pipeline quality gas. Specifically, this program will continue development of each of five different, but technically feasible, processes for the conversion of coal to high-Btu gas. Concurrent development of each concept through the pilot plant stage could generate the data necessary to determine which of the five concepts is more suitable for implementation on a

commercial scale. The program is also directed toward the development of a suitable and compatible methanation process (to up-grade the gas produced in a state-of-the-art gasifier), and the development of advanced structural materials and processing equipment. Two pilot plants are presently operating and three others will begin operations within the near future. This work will continue to the point at which sufficient design and engineering data are available for industry to construct a commercial-sized facility. The present schedule calls for pilot plant operation through 1979 and construction of the demonstration plant to begin about 1977 with operation of such a plant by 1980.

Plant and capital equipment

Project 76-1-b, High-Btu pipeline gas demonstration plant:

Fiscal year 1976 original request---
Committee action__.

Total

Transition period:

Original request.

Committee action_-_

Total

Thousands

$20,000

20,000

5,000

5,000

This project provides for the conversion of coal to a high Btu, pipeline quality gas which can be introduced into already existing pipelines. The increase of $20 million for the Pipeline Gas Demonstration Plant will provide funds for early procurement of long-lead delivery equipment items. With this authority, early procurement of items such as special compressors, principal gasification vessels, oxygen plants, and other items of equipment with deliveries estimated to be in the range of 30-48 months will be placed on order as rapidly as specifications can be prepared.

The Pipeline Gas Project anticipates multiple awards. From designs prepared in Phase I, plants will be selected for final engineering and construction. As the work proceeds, general specifications to cover more than one process will be prepared for each item of equipment that analysis shows as a pacing item in construction of the plant. Placing of these orders at the appropriate time, to fit the construction schedule, will save a minimum of 12 months in terms of plant completion date. In some cases the time saving can be as long as two years.

The second phase of this project involves construction of the demonstration plant at a location chosen to insure ready deliverability of equipment and a broad range of available coals. Construction will be phased for the earliest possible operation of the gasifier. A significant feature of the design will be the ability to produce a range of products, as well as to test a variety of gasifiers. By modifying the shift cleanup system, the plant may be converted to the production of methanol or higher alcohol, motor fuel, waxes, and high-quality fuel (low-Btu) gas, as well as SNG. Earliest tests, of course, will be for the production. of SNG.

During the operational phase, the plant will be operated to determine the commercial economics of coal gasification to produce SNG. As a follow-on, alternate products taken along or in combination with SNG

will be studied in detail to determine and fix commercial-scale economics. Also, it is expected that data on the gasifiers can be utilized to determine the best gasification system to produce hydrogen for liquid fuel plants.

(3) Coal low Btu gasification.—

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The Interior Committee recommends a shift in funding from "operating expenses" of the low-Btu gasification sub-program to a capital account so that seed monies will be available to begin construction of a low-gasification demonstration plant.

The low-Btu gasification program is designed to provide the technology necessary to produce a gas suitable for power generation and combined gas turbine/steam turbine power cycles, thus further employing coal as a utility fuel. The specific objectives of the program are (1) to develop at the earliest possible date one or more gasifier systems which are economically applicable for the use of coal as a substitute for oil and natural gas for power generation and industrial use, and (2) to provide the technology required to initiate the conceptual design of a demonstration plant and permit the widespread commercial utilization of low-Btu gasification by the mid-1980's.

Low-Btu gas is best used near its source, since pumping costs per Btu are high and the gas produced is hot and this heat is conserved by not transporting great distances. Both reduced process complexity which allows lower capital costs on an equivalent Btu basis and the fact that some energy consuming steps (e.g. methanation) would not be needed, thus increasing the overall thermal efficiency and lowering operating costs, makes the production of low-Btu gas attractive.

The program provides for the development of above ground gasification for operation at near atmospheric and higher than atmospheric pressures, supplemented by the development of underground coal gasification technology. According to ERDA, the state of development of near atmospheric gasification is currently more advanced than that of pressurized gasification. Therefore, the intent of the program is to promote the development of near atmospheric gasifiers as a primary objective and at the same time begin development of higher pressure gasifiers in order to provide a commercially acceptable process at the earliest possible date.

The Interior Committee specifically authorized an increase of $7.5 million to permit a substantial expansion of the in situ coal gasification program. It is anticipated, by the Committee, that this increase, bringing the total level for this program to $12.5 million, will permit a second field test (in addition to the Hanna, Wyoming Test) of a

process for deep, thick coals, a possible test of a process for thin eastern seams, site selection and process evaluation aimed at a pilot scale project, and exploration of new concepts as well as supporting laboratory and systems studies.

The following table delineates both the present $5 million program and what ERDA might do with an additional $7.5 million.

Field test a 2d concept, the vertical packed bed process (Lawrence Livermore Lab)..

Possible field tests of a thin seam process (Morgantown Lab).

Field instrumentation development (Sandia Lab)..

Site selection for pilot scale project..

Laboratory support studies.

Explore advanced concepts.

Laboratory support studies.

Laramie Field test..

Total....

Plant and capital equipment

Project 76-1-c, Low, Btu fuel gas demonstration plant:
Fiscal year 1976 original request----
Committee action___

Total

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Transition period:

Original request_-_

Committee action___.

Total

3,750

3, 750

This project provides for the conversion of coal to a low-Btu gas which could be used for fuel in conventional Rankine cycle electric power generation and also as a source of energy input to advanced cycle machines.

It is expected that ERDA will seek competitive bidding for preliminary engineering design of a commercially-scaled gasifier for electric power generation. It is expected that a number of designs will result, from which one or more will be selected for detailed construction design and costing of a demonstration plant. Construction and operation of the demonstration plant will then follow, at a location where integration with conventional and advanced cycle power generation can be accomplished. Both air-blown and oxygen enriched gasification will be tested to determine production costs for alternate power systems. Feasibility of using slagging as well as non-slagging coal will be tested. Optimum procedures for cleanup and disposal of slag and ash will be determined. The capacity for cleanup of an individual gasifier is expected to range upward to 3,000 tons per day of coal feedstock.

Early procurement of gasification equipment and supporting machinery will be materially assisted by provision of $15 million for this important demonstration plant. Special designs for unusual items of equipment can be prepared and equipment placed on order based on preliminary analysis of the total plant concept. Substantially all

gasification equipment will be special and of a new and unique design. The $15 million will enable completion of the finished plant from 15-21 months sooner than would be possible without this capital expenditure authority.

Special items of equipment being developed with both Federal and private funds to provide clean gas for use in an expansion turbine can be purchased as developments warrant. Provision can be made to purchase the expansion turbine needed with provision to utilize the output in the production of power and in the compression of combustion air or oxygen.

Plant and capital equipment

Project 76-1-d, Low-Btu combined cycle demonstration plant:
Fiscal year 1976 original request_-
Committee action-----

Total

Transition period:

Original request_.
Committee action_.

Total

Thousands

0

$5,000

5, 000

1, 250

1, 250

This project will provide for the utilization of gas turbines in combination with steam turbines. This technological innovation is most likely to promote efficient use of fossil fuels in the generation of electricity. Combined-cycle (Brayton-Rankine) plants utilize the presently wasted hot exhaust from gas turbines to generate steam for conventional steam-electric generators. An additional increment of electricity is thus obtained with the same level of fuel consumption. This improvement in the efficiency of energy utilization in steam-electric plants is commonly expressed in terms of the heat rate.

An additional $5 million for this important work will allow design and procurement of a special combustor gas turbine arrangement based on combustion characteristics of the fuel gas to be produced. The combustor/turbine must be of special design since all standard commercially available equipment uses high quality gas or high quality liquids. Exhaust gas from the cycle must be processed in a waste heat boiler and this unit, too, will be designed and placed on order. Early procurement will allow construction of the combustor and turbine and its testing with simulated low B.t.u. gas. A minimum of two years will be saved in terms of testing a gasifier/gas turbine plant by authorizing this early capital expenditure.

(4) Coal advanced power systems.

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