Great Falls Tribune (MT) (pg. A1), January 31, 2008

AIR FORCE TOUTS CLEAN ENERGY

By Peter Johnson

U.S. Air Force officials briefed a crowded room of 165 Great Falls residents Wednesday about a proposed coal-to-liquid-fuel plant on Malmstrom Air Force Base that they said would use new, clean technology to help lessen the nation's dependence on foreign oil.

About a dozen of the audience members in the Civic Center questioned state and Air Force officials about the plant's greenhouse gas emissions, waste products and location.

"Energy is a critical pillar for the Air Force," because U.S. oil reserves are being depleted and newly industrialized China and India are competing for energy, said Assistant Air Force Secretary William Anderson.

The Air Force, the government's heaviest user of fuel, is "jumping in with both feet" by converting its jets to synthetic fuel and proposing private developers build a coal-to-liquids plant at Malmstrom , major solar plants at three other bases and modern nuclear plants at one or two additional bases, he said.

"We're committed to domestically made, clean energy," he said.

Air Force consultant Pete Lapuma said Malmstrom was selected for the coal-to-liquid, or CTL, plant because Montana Gov. Brian Schweitzer supports the clean-coal technology and Great Falls is near Montana's abundant coal reserves, Missouri River water, good rails to transport 150-car coal trains daily and good power lines to carry a projected 50 to 100 megawatts of surplus power from the plant. In addition, he said, an oil company in Montana would be a willing buyer of much of the carbon dioxide produced by the plant, which can be captured, piped to the oilfield and pumped underground to force up stingy oil reserves.

The United States has a 250-year reserve of coal but only about a 10- year reserve of oil and gas, he said.

The projected plant would use about 10 million gallons of water a day, less than 1 percent of the water flowing by Great Falls in the Missouri, Lapuma said. It would have a 300-foot tall gasifier stack.

Evan Barrett, Gov. Brian Schweitzer's chief business development officer, said Montana is blessed with several types of energy, "and do we ever have coal," with 28 percent of the nation's coal reserves and 9 percent of the world's. He said Schweitzer wants to use new technology to put the coal to use in a way that reduces climate change-causing emissions and the nation's dependence on foreign oil, while helping create solid economic growth in Great Falls.

Barrett later said the private plant would pay property taxes, even though it would be built on federal property.

Anderson met with Schweitzer and Montana's congressional delegation last fall to propose offering some 700 acres of "underutilized land" at Malmstrom to a developer willing to build and operate a CTL plant that could make 20,000 to 30,000 barrels of fuel a day. Such a plant is expected to cost about $2 billion.

Montana congressional members have said that as many as 1,000 workers could be employed during construction and 300 to 400 as plant operators, but a mining industry spokesman said the plant could produce twice as many jobs.

The Air Force has scheduled an invitation-only "industry forum" today at the Holiday Inn at which the Air Force will showcase the proposal to some 100 industry developers, contractors and financers who might want to build the plant.

"We're running a 10-mile race in building this plant and are barely out of the starting gate," Anderson said, stressing that a lot of research will be done by the Air Force and developers to make the first U.S. CTL plant environmentally "green" by collecting carbon dioxide and finding ways to make it a usable commercial product.

Anderson said the exact location, size and design of the plant will depend on the winning developer's proposal, but the Air Force wouldn't accept a plant that wasn't environmentally friendly or that put at risk Malmstrom 's existing missile mission or the quality of life of Great Falls residents.

At a later press conference, Anderson said the Air Force hopes to select a developer to build the plant by this fall. He projected it would take at least four years to build the plant, including lining up financing, engineering and design, environmental permitting and a lengthy construction period.

Matt Leow of the Northern Plains Resource Council spoke for nine environmental groups in opposing the plant.

They maintain that the CTL plant would produce a fuel with twice the climate change-causing pollution as conventional petroleum at a time when carbon capture and storage is not yet been widely used. The groups say CTL plants are financially risky and use a lot of water.

Chuck Magraw of the Natural Resources Defense Council questioned whether the Air Force can comply with a provision of a new energy bill that bars government agencies from purchasing CTL or other alternative fuels for transportation if the fuels have higher greenhouse gas emissions than conventional fuels.

Anderson said the Air Force will not buy such fuel "unless it's greener" than conventionally made fuel. It may be marginally cleaner initially, but private business and Air Force engineers are working on ways to capture and reuse carbon dioxide, he said.

Lapuma said that CTL works best when impurities such as carbon dioxide, mercury and sulfur are removed in the industrial process, adding that they can be valuable products to sell.

Chemical engineer and environmentalist Kathleen Gessaman said she lived in South Africa 26 years ago and was shocked to see huge piles of ash and other waste surrounding a large CTL plant there.

If the ash and minerals from such plants are so valuable, why haven't they been put to use in booming South Africa, she asked.

"Rip-and-run industry is no longer permitted," Barrett said.

Anderson said South Africa built huge CTL plants 30 to 40 years ago when it faced economic boycotts because of its apartheid policies. That country was more concerned about economic survival than a clean environment, he said.

Businessman Brad Talcott asked how much carbon dioxide the new plant would produce and how and where it would be shipped.

State Commerce Department energy specialist Tom Kaiserski said a Montana oil developer has indicated he could use almost all of the plant's carbon dioxide for enhanced oil development. An estimated 15,000 tons a day would be shipped by pipeline.

Physician and environmentalist Cheryl Reichert said the Great Falls area is still suffering from earlier coal development. She also wonders if the Malmstrom plant would mine more of the "thin remaining veins of bituminous coal."

Kaiserski said that while there are some coal reserves near Great Falls, most of the early discussion has involved using richer reserves from southeastern Montana. But it will be up to the plant developer to decide which coal reserves will be most economical to use, he added.

Farmer J.C. Kantorowicz asked whether planners had considered placing the plant closer to the north side of the base, near a rail spur leading to the coal-fired base heating plant, rather than in the southern part of the base near the former runway.

Lapuma said that idea was rejected initially for a variety of reasons, including the aging rail spur and its closer proximity to the city. He added that the developer would have the major say on the final site selection.

Businessman David Weissman, chairman of the Chamber of Commerce Military Affairs Committee, said later that the presentation "took care of the majority of my concerns. The plant could be a great project for Great Falls."

Like other Malmstrom supporters, Weissman said he would like to see the runway, which has been closed for 10 years, reopened for flying missions.

"But I don't know when that will be possible and it might be time for the nation to take control of our own destiny by reducing our dependence on energy from unfriendly nations."

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