Brisbane, Feb 19, 2009 AEST (ABN Newswire) - Carbon Energy Limited (ASX:CNX)(PINK:CNXAF) The Queensland Government yesterday announced a new policy in relation to overlapping tenements between Underground Coal Gasification (UCG) and Coal Seam Gas (CSG) producers that clarifies the issue of priority access to resources and provides a clear pathway for all parties to move to production.
The key outcome for Carbon Energy is that the policy provides priority and certainty of tenure for Carbon Energy for the resource contained within its existing Mineral Development Licence area (MDL 374).
Andrew Dash, Carbon Energy's Managing Director commented on the recent policy decision by saying "This policy ends months of speculation as to the competing rights between UCG and CSG players.
For Carbon Energy this means that we have exclusive rights to at least 224 million tonnes of coal (approximately 75% of our recently announced resource upgrade) contained within our MDL which is suitable for UCG.
Based on our recent trial results, which demonstrated we produce 20 GJ for each tonne of coal gasified, we have at least 4,480 PJ of energy in situ. We believe that by applying our world leading UCG syngas technology and panel design that in excess of 2,500 PJ of UCG syngas is recoverable.
This is a huge resource in gas industry terms and can support more than 6 world scale manufacturing plants for over 30 years.In addition, the northern half of our MDL is relatively unexplored and is prospective for coal suitable for UCG; consequently further exploration in this area is likely to add substantially to our resource availability in the future.
This policy decision will now enable us to execute our plans for the development of this resource with full confidence".
The announcement also outlined the requirement that each UCG syngas trial project be subject to monitoring conditions, including meeting stringent environmental standards, by the EPA (Environmental Protection Agency). "Such requirements exist now and as such were not unexpected. Indeed, we welcome the Government's commitment to continued environmental monitoring as this goes to the heart of our process and is one of the key benefits our technology" said Mr Dash.
Carbon Energy believes it is prudent to follow appropriate review processes for all major projects, including UCG syngas projects. Carbon Energy's technology and process is the result of rigorous scientific development by Australia's premier research organisation over 10 years, the CSIRO, and Carbon Energy welcomes any appropriate review of its world leading technology.
About Carbon Energy Limited
Carbon Energy (ASX:CNX) (OTCMKTS:CNXAY) is building a gas business, utilising its unique keyseam technology.
The Company is committed to providing industrial gas users with an affordable and secure source of high quality feedstock, as gas prices remain strong, through increased demand across our key markets.
Carbon Energy is the only company to complete a full-lifecycle, commercial scalable underground gasification trial. The Company's keyseam technology has successfully accomplished all the recommendations outlined by the Queensland government's Independent Scientific Panel (ISP) which included intense, independent environmental scrutiny.
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