Coal-to-liquids

China's largest coal producer Shenhua Group has launched the world's first project of direct coal liquefaction in its Shendong coal field in Inner Mongolia. When completed after two phases of construction, the project will have a capacity of 5 million-ton oil products [36.7 million barrels]. The production line for the first phase has begun to be built and will be put into production in 2007 when the 24.5 billion yuan facility will be able to turn out 3.2 million tons of oil products [23.5 million barrels].

bdtonline.com :

The U.S. Senate has approved a push by U.S. Sen. Robert C. Byrd to spur the development of a national coal-to-liquid fuels production. The legislation also would allow the Department of Defense to examine potential uses for these new fuels within its system. The Department of Defense has previously recognized the important role coal-to-liquids could play and has expressed a strong interest in transforming alternative resources into transportation fuels.

- Two announcements by two major powers on two consecutive days on the same topic : conversion of coal to oil for transportation. Is this a move of genius or a move of desperation? Because the last time this process was attempted on a large scale, it was by Adolf Hitler in an effort to overcome Germany's lack of oil resources during World War 2.

During wartime, I'd suppose one could say, screw the economic constraints and go produce petrol at any cost. But are times becoming that desperate now? Discerning peakoilers will also be asking questions like : What's the cost per barrel? What's the conversion factor (coal tons to oil barrels)? What's the EROEI? What are the GHG emissions?

And the obvious one : when does Peak Coal arrive?

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