Red Mountain Energy participated in the World CTL 2011 conference

10.03.2011

The World Coal-to-Liquids conference was held in Paris from March 1^st-3^rd, 2011. The subjects under discussion were gasification and direct liquefaction of coal, production of liquid motor fuels, synthetic natural gas and chemicals. The event was organized by the World CTL Association, France and by Total.

The conference brought together representatives of over 100 companies and organizations from 20 countries worldwide, including Exxon Mobile, Synthesis Energy Systems (USA), Axens (USA and France), BP, World Coal Association, World Energy Council (UK), IFP Energies Nouvelles, Trapil, International Energy Agency (France), Rosnano (Russia).

On the first day of the forum, leading experts of the global CTL industry made presentations on topical issues:

• Gasification: New Developments and Projects Update
• Syngas to Gasoline Substitute Natural Gas and Chemicals
• Direct Coal Liquefaction
• Methanol to Olefins

Non-Conventional Technologies:

• Underground Coal Gasification
• Plasma Technologies, Pyrolysis.

The second day was devoted to economic strategy in certain developing regions, namely India, Russia and China. Participants reported on innovative fuel conversion projects in Australia, and coal to liquids projects in South Africa. On the third day the main themes were environmental safety, and the impact of CTL on the environment.

Olesia Pashchenko, senior project manager of the Russian branch of Red Mountain Energy, gave a presentation about the company and its role in the world market of gas processing. She spoke about the prospects of coal gasification technology in Russia, Ukraine and other CIS countries. Ms. Pashchenko assessed the current situation of the coal industry, highlighting specific difficulties, in particular the limited railway capacity in this region, and how this affects companies which are increasing their coal production; and the lack of available transport infrastructure which results in the high cost of transporting coal from production areas to consumers. In her summary Olesia Pashchenko emphasized that coal gasification technology is of interest to coal companies in terms of processing and making profitable use of low-quality brown coal (at the present time transportation costs of this low quality coal exceed the market value). When it comes to other industrial sectors such as energy, steel and oil processing, gasification of coal or petroleum residues provides low cost synthetic natural gas or hydrogen for the industrial needs of these sectors, at the same time ensuring energy independence from state corporations in the purchasing of this feedstock (natural gas).

Another precondition for the development of gasification technology is the emerging shift in the economic policy of Russia, which is aimed at delivering products with a higher added value. The main target is more advanced extraction and processing of natural resources: a transition from the straight forward export of mineral resources, to the deep conversion of feedstock and the sale of a more valuable product. Such a change in economic strategy implies a certain involvement and encouragement from the state, such as tax incentives. And although such technologies are still challenging and require high capital costs, nevertheless coal to motor fuels and synthetic natural gas technology is the ideal alternative to traditional processes, especially in remote areas with poor transport infrastructure. The experience of Red Mountain Energy with its long experience in the processing of natural and associated gas, surface and underground coal gasification, is in a strong position to implement such projects in Russia and other CIS countries.