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Stewart Dalby: Algy Cluff’s coal-to gas project gains momentum

Cluff Natural Resources is the latest venture of Algy Cluff and the company is focused on underground coal gasification (UCG).

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The UK’s reserves of gas in the North Sea are in steep decline.

The F word is making waves again. No, not that one, the other one, “Fracking”.

Earlier in July when Cuadrilla’s fracking plans were rejected by Lancashire County Council the shares in Cluff Natural Resources fell 20%  on the London stock exchange (LSE).

This was perhaps the clearest indication yet of the uncertainty over all energy  projects in the UK  that require local planning approval even if they use technologies other than fracking or fracture stimulation, to give the process its full name, to liberate tightly held gas and oil held in shale rock structures.

Cluff Natural Resources is the latest venture of Algy Cluff and the company is focused on underground coal gasification (UCG).

Cluff is famous as one of the pioneers who discovered oil and gas in the North Sea. He has written: “In 1972 I formed a company to apply for oil licences and our efforts were quickly rewarded with the discovery of the Buchan Field.”

He added that when he was travelling around North Sea oil rigs he was struck by the presence of substantial thicknesses of offshore coal, that his geologists happened upon.

He reckons that the UK faces problems in two ways. The government wants to close all old polluting coal power stations and become more reliant on cleaner gas to keep the lights on.

But the UK’s reserves of gas in the North Sea are in steep decline and there is, of course, the fierce debate about fracking onshore the UK going on.

Meanwhile, the UK’s dependence on gas imports (current 47% of the total used) could rise to 80% by 2020 as it relies on the likes of Norway and liquefied natural gas (LNG) from less stable states.

Cluff believes he could have the answer to the problem by gasification of the coal. Proven technology for this has worked elsewhere around the world, in Russia and Australia for example. Cluff is convinced it could work in Britain where there is a lot of stranded coal.

Accordingly, he assembled 11 licences to look for gas around Britain. Some five of them are close to old coal areas like Durham and Whitehaven in Cumbria.

Cluff has focused, as his first project, however, on the Kincardine licence in the Firth of Forth offshore Scotland.

The area contains 335mln tonnes of coal. The immediately exploitable part of this resource is the energy equivalent of 1.4bn cubic feet of natural gas. To put this in perspective, 1bn cubic feet of gas would meet the energy needs of 11,000 homes for one year.

The gas can be extracted without having to mine the coal. Horizontal drilling techniques, ironically honed in shale gas extraction, can be used to access the coal from onshore so the conversion can take place on site.

Unlike fracking, the gasification process does not need millions of gallons of fresh water, does not involve underground explosions and possible earthquakes.

It does not need toxic chemicals which, so it is said, can leach into aquifers and contaminate water supplies. And it requires only two drill holes rather than dozens.

Oxidants, usually oxygen and steam would be pumped down one borehole under pressure high pressure causing the coal to combust.

The captured syngas a combination of hydrogen, carbon dioxide, carbon monoxide and methane is pumped up a second borehole and cleanly delivered to a power station.

Critics of UCG have concerns on various fronts, most notably greenhouse gases like carbon dioxide and methane escaping into the atmosphere and underground fires caused by the combustion process.

 A long and well –researched article in National Geographic magazine written by Thomas K. Grose in London said: “UCG might have to overcome intense resistance from protesters.

“Frack Off, the lead protest group that has so far successfully slowed efforts to introduce fracking for shale –gas production in Britain, is already lining up against UCG, claiming it’s as much of an environmental threat as fracking.

Jon Gluys, a geo-energy professor at Durham University, isn’t convinced the public can be won over either.

“The thought of a fire burning under your feet doesn’t even get to the starting line.”

Defenders of the process strongly argue these problems can be managed. Underground fires can be controlled by monitoring how much oxygen goes down the borehole.

As for carbon capture, proponents of UCG say it would less expensive and more efficient to strip carbon dioxide from coal at a UCG site than a power station.

A bigger problem going forward is that the drilling will start onshore. That means planning permission will be needed. As we all now know that can take a long time with new technologies.

Algy Cluff seems confident that his project will prevail.

He has been quoted as saying: “We are talking about a second North Sea here…… It’s far too big an opportunity for government and energy ministers to ignore.”

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