Orroroo Coalfields – Linc Energy Announcement

Well who’d’a thought!

‘Linc Energy Ltd (ASX: LNC) (OTCQX: LNCGY) is pleased to announce the completion of an initial drilling program near the town of Orroroo in South Australia.’

‘Five exploration wells intersected coal at depths of between 200 and 293 metres with coal seam thickness of up to 23 metres.’

‘Subject to necessary approvals, Linc Energy’s intention is to fast track the commissioning of a modest sized UCG commercial facility at Orroroo to confirm the suitability of the resource for low cost synthesis gas production that can be used for power generation and GTL production of ultra-clean synthetic fuels. This commercial UCG generator will become the cornerstone of Linc Energy’s commercial program at the Orroroo site in the months ahead.’

‘The Orroroo deposit is of a scale which the Company believes can support 500 MW of high efficiency power generation which will be a significant addition to South Australia’s electricity system which currently requires additional generation. In addition to power generation, the Orroroo deposit is of a scale that can also support a plant to produce 20,000 barrels per day of ultra-clean synthetic fuel. The production life of the combined facilities based on the scale of the deposit is expected to be approximately 75 years.’

In making this announcement, Mr Peter Bond, Chief Executive Officer of Linc Energy, commented that “these initial drilling results are fantastic and confirm my belief that the coal in this area has all the attributes we are looking for in our first commercial UCG site. By that I mean great coal, at ideal depth, excellent coal seam thickness, good geology and flat terrain. This deposit can support significant production of low cost synthesis gas for power generation and synthetic fuels GTL production for a generation or more”.

Mr Bond went on to say that “with Orroroo’s close proximity to Adelaide and with good access to port and power transmission infrastructure, the location is just about perfect for what we are planning to achieve. We value the strong support we have received from the local community and the South Australian Government and with their continued support, we intend to push forward aggressively to develop the fantastic potential that the Orroroo location has to offer.”

Download the ASX Announcement and media release: Update_on_South_Australian_UCG_Program_-_2006-11-09 ~ 5Mb pdf

15 Comments

  1. Linc Energy on 12/01/2010 at 12:53 pm

    There has been quite a bit of discussion about Linc Energy and UCG technology in this comment thread. To the extent we can, here is some further clarification:

    1. Linc Energy is in the business of Underground Coal Gasification (UCG), which is very different to the CBM/CSG industry mentioned in the comment thread. UCG does not produce the vast quantities of saline water that has been a significant issue for the CSG industry to manage in many areas of the world and which was a point of discussion at the town meeting held in November 2009.
    2. The coal identified in the Orroroo region is low rank (low value) coal, which due to its depth, is unsuitable for conventional mining. Our drilling and analysis however suggests that this coal is very suitable for extraction using Linc Energy’s world-leading UCG technology.
    3. Following our successful exploration program in 2009, we have now recommenced further drilling in the area in order to better define the full extent of the coal resource and to provide access to groundwater aquifers for hydro-geological studies. This is critical for our environmental assessment program.
      We will update the community further as this program nears completion. Some of you may have seen the Boart Longyear rig resting in the Council depot prior to recommencing drilling and may be aware of the drilling activity around the area.
    4. It is Linc Energy’s intention to start with a small UCG trial operation (similar to its Chinchilla Demonstration Facility) to confirm, in a practical sense, the suitability of the coal and geology/hydro-geology. Pending the success of that work, we intend to move into the next phase of commercial operations, which will be a significant gas-fired power generation facility. As we mentioned at the community meeting, gas turbine based generation has a much smaller footprint and has higher thermal efficiency than traditional coal-fired generation, such as Port Augusta, referenced in this thread.
    5. As soon as practical, Linc Energy will establish the site of its initial UCG operations at Orroroo, including a site office and other initial infrastructure. As we further develops plans and timelines, more details will be provided about the timing, nature and number of employment opportunities for the local area. We currently anticipate having a small, locally-based workforce of perhaps 15-20 people by the end of the year, although these numbers and the timing require confirmation.

    We will continue to provide as much information as we can, as often as possible. We are happy to answer other individual queries and these can be addressed to linc@lincenergy.com.au.

  2. Brent Scotcher on 21/12/2009 at 1:46 am

    If all go, after the plants have been constructed, does anyone have a rough idea of how many employees will be required to work the plants and what it will mean for the area and nearby towns.Was the 1100-1200 employees in the paper for construction only?

    • John Mannion on 21/12/2009 at 10:33 am

      I would be dubious about the 1100-1200 employees …
      I see that the Boart Longyear (Linc Energy contract drillers) rig is back at the Orroroo recreation ground in readiness for the further drilling of wells in Walloway basin next year. As Linc Energy mentioned at their recent information session, there is more drilling to be done. Linc Energy is very positive about the results they obtained from the last drilling program, and thus wish to complete more drilling to confirm these results.

      • Brent Scotcher on 21/12/2009 at 9:38 pm

        Thanks John.I think they must have meant 1100-1200 for the construction of the plants but still sounds a lot.
        It would interesting to see if they are finding naturally occurring methane in the coal seams as this could start a CBM (coal bed methane) / CSG (coal seam gas)
        industry in the area which is very popular in Oz at the moment.
        Queensland especially is flat out with this type of drilling for companies such as Queensland Gas, SANTOS, Arrow e.t.c.
        If they find some CBM/CSG, it could be history in the making !

  3. John Mannion on 20/12/2009 at 9:58 am

    I see that some Boart Longyear drilling equipment is back in Orroroo. I know that Linc was planning further exploration holes at Walloway basin early next year.

  4. John Mannion on 20/12/2009 at 9:54 am

    We’ll all be rooned if oil don’t come this week!

    • tim on 23/12/2009 at 1:17 pm

      John (Hanrahan) Mannion! 😉

  5. Hanafina Svetlana (Uzbekistan) on 16/12/2009 at 3:49 am

    well you are doing this technology, we have a very hard, we defend the idea of Mendeleev

    • John Mannion on 18/12/2009 at 2:48 pm

      Hanafina, I notice you are in Uzbekistan, what are you referring to when you say “the idea of Mendeleev?”

      • Hanafina Svetlana (Uzbekistan) on 19/12/2009 at 5:08 pm

        I am working on Angren brown coal deposits at the OJSC “Yerostigaz”. And your business is our primary investor and I am very pleased that the technologies are clean coal conversion began rapidly razvivatsya.Odno time was a complete standstill on this technology, and now we are not alone and that raduet.Mne will be pleased with you to continue the correspondence.

  6. admin on 07/12/2009 at 6:32 pm

    I wondered how big 500 MW power station was, well Port Augusta is about 800MW!

    • tim on 20/12/2009 at 9:35 am

      I also wondered how much 20000 barrels a day was. From what I could find from Wikipedia, a ‘barrel’ in oil terms is a smidge under 159 litres.

      That’s over 3 million litres a day. Which means major transport infrastructure. Might be worth paying attention to the district council minutes from now on.

  7. Graeme Oakley on 04/12/2009 at 1:12 pm

    I have just been given the distributorship rights for the Aquatex range of products from WRI in the USA
    They have just field tested and got the go ahead for a coal seam gas water reclamation plant at Wyoming for Conoco Philips using the Aquatex COG advanced technology to carry out the water recovery.

    With the carbon ETS and the water shortage in SA I thought you might be interested in this product and we could work on a CSR water reclamation project to show how Gren and sustainable the operation could be.

    • admin on 04/12/2009 at 1:50 pm

      Graeme, give Linc Energy a call:

      Lorri Teepa
      Investor Relations & Corporate Communications Advisor

      32 Edward St | Brisbane | Qld | 4000
      GPO Box 1315 | Brisbane | Qld | 4001
      P | +61 7 3229 0800
      F | +61 7 3229 6800
      E | linc@lincenergy.com.au
      W | http://www.lincenergy.com.au

      • Bet and Paul Gillard on 07/12/2009 at 5:59 pm

        The Graeme Oakley (above) is a work associate of mine here at Ozzi-Kleen headquarters at Kunda Park Queensland. I mentioned the Linc Energy operation and he has had positive feedback already. Suncoast Waste Water Management are the proud manufacturers of world class domestic and commercial treatment systems. Our team of engineers can offer environmentally sound outcomes with second use water available for trees shrubs or grass areas . We often look in on Orroroo and its great to see a lot of positives.

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