This article originally published in Appalachian News-Express

December 7, 2006

East Coast's only coal-to-liquid plant to locate in Mingo

BY LEIGH ANN WELLS
STAFF WRITER

WILLIAMSON, W.Va. - A project that has taken more than two years to develop came to fruition yesterday, when an announcement was made that Mingo County will be the site of a new coal-to-liquid plant that will process coal into diesel fuel.

The announcement was made by Mingo County Redevelopment Authority (MCRA) Executive Director Mike Whitt and Richard O. Sheppard, senior vice president for project development of Rentech Energy Solutions Inc., a California-based company with offices in Colorado.

“We're so excited here,” Whitt told Sheppard, members of the MCRA board and state regulators who attended the meeting. “It will be the only project on the East Coast.”

Sheppard said that representatives of the MCRA came to Colorado about eight months ago to discuss the possibility of locating the plant in Mingo County. Sheppard said once the delegation made their presentation, he and representatives of Rentech were very impressed.

“We said, ‘There is a real opportunity in West Virginia,” Sheppard said. “These guys are real. They know what they are talking about.”

Sheppard explained that Rentech concentrates on transforming coal into usable, ultra-high purity diesel fuel that has a shelf life of up to eight years. The coal is transformed using the Fischer-Tropsch (FT) technology which consists of three steps - gasification, FT conversion and upgrade. Sheppard said the FT process can work with any coal that can be gasified.

Sheppard said the global diesel demand is growing dramatically and that CTL plants can play a role in national security by cutting the United States' dependency on foreign oil. He said the U.S. has huge coal resources and a huge energy problem.

Sheppard explained that Rentech is developing five projects, with Mingo County being the fifth. Other project locations are on the Illinois/Iowa border; in Natchez, Miss.; on the Kentucky, Indiana and Illinois border and in Montana.

The joint development agreement signed by Sheppard and Whitt yesterday will be followed by the initial phase of the project - a 60-day due diligence period - that will begin the first week of January 2007. If the project is viable, Rentech and the MCRA will continue to evaluate the project in stages by determining the scope and feasibility. After successful completion of these initial stages, Rentech and the MCRA expect to establish a project entity and then move forward with engineering, financing and construction. Initially, the parties will share the costs of any third-party development expenses and have equal interests in the project.

Sheppard said the Mingo County plant will be designed to produce 20,000 barrels per day. The project will cost an estimated $2 billion with construction tentatively set to begin within two years.

The construction phase could produce as many as 1,500 construction jobs. An estimated 400 fully-employed “good” jobs will be available once the plant opens about four years from now, Sheppard added, calling the project an “exciting opportunity for devastated coal communities.”

“We're looking forward to doing something here,” Sheppard said.

MCRA Chairman Terry Sammons thanked Sheppard for choosing Mingo County.

“The formation of the joint development agreement between the Mingo County Redevelopment Authority and Rentech represents a vital step that West Virginia is taking in its efforts to further national energy independence and security while utilizing our resources in an environmentally responsible manner,” Whitt said. “Mingo County is also about creating jobs and development for our state while producing products that keep America clean and safe.”

D.Hunt Ramsbottom, president and CEO of Rentech, released a statement in which he thanked the MCRA and the state of West Virginia for giving Rentech the opportunity to jointly develop the clean fuels plant.

“West Virginia's vast supply of high-energy content coal and readily available mining infrastructure provide the necessary support that can make this opportunity a reality,” Ramsbottom said.