§ 1. Mr. Welshasked the Secretary of State for Energy what further investment is earmarked for coal refineries that will make transport fuels and chemical feed-stocks, in view of their importance to the plastics and other industries.
§ 15. Mr. Dormandasked the Secretary of State for Energy if he is satisfied with the progress being made with coal liquefaction; and if he will make a statement.
§ 20. Mr. Gwilym Robertsasked the Secretary of State for Energy what are the latest figures available for the energy involved in producing one gallon of petrol from the liquefaction of coal; what is the approximate cost of such a 2 gallon; and if he will take steps to speed up and expand the programme for the abstraction of oil from coal.
§ The Under-Secretary of State for Energy (Mr. John Moore)Design studies are nearing completion for a pilot plant facility to test the NCB's liquid solvent extraction and supercritical gas extraction processes at the 25 tonne per day scale.
The Government, with the NCB and BP, are considering what level of support can be given to the construction and operation of the facility, which, on latest estimates, would cost about £55 million. I am satisfied that the NCB processes are being developed at a sensible rate. Based on NCB technology, about 20 pounds of coal would be required to make one gallon of petrol, which would cost an estimated 25 per cent. more at the refinery than petrol from natural crude oil.
§ Mr. WelshWhile thanking the Minister for that reply, may I ask whether he is aware that other countries are spending vastly more on this development than Britain? West Germany, for example, is spending £3,000 million on this sort of refinery. In the United States, millions of pounds are being spent and even Royal Dutch Shell is producing a plant to extract gas in Holland costing £70 million. Can the Minister assure the House that the amount of money being invested in Britain is enough to guarantee the supply of energy from these sources 3 in future years? Or will it be the case that we have invested too little too late?
§ Mr. MooreWe are continuing exactly the programmes of the previous Administration. The programmes of the previous Administration, like those of this Government, rightly took into account the very different natural circumstances within which we live. We cannot, happily, ignore our reserves of North Sea oil, which put the timing, as opposed to the importance, of our liquefaction processes into a different position.
§ Mr. DormandIn supporting my hon. Friend, may I ask whether the Minister is aware how far behind other countries this country is falling in this important matter? As we have so much coal, and the expertise—which is extremely important—and as the need is so pressing, will the hon. Gentleman increase the resources available for this important development?
§ Mr. MooreI reject the suggestion that we are getting far behind. An important tripartite meeting involving the working party took place on this matter. We have just received the preliminary design studies for which we have been waiting. We are considering them urgently. No delay has taken place. The most interesting and important outcome of the design studies is that, on current projections, for an identical product spectrum, the United Kingdom processes seem to have a cost and efficiency advantage compared with leading United States processes. Contrary to the suggestion that we are far behind, our intelligent, serious and exciting NCB work seems to show that we are potentially far ahead.
§ Mr. Allen McKayWill not the Minister accept that the Government should take more interest in these processes, like other countries? Is he aware that the Selby project could not have gone ahead if it had relied on private capital? Will he give an assurance to the House that Government finance will be available for these projects?
§ Mr. MooreI am trying to work out the connection with the original question. I cannot imagine any project that the Government have examined that has not involved serious and continuing interest and commitment. We must, however, make the decisions, as the plan for research 4 and development proposed, correctly, and at a time when all the facts are available. The rate of return on Selby shows that it is an exciting investment, whoever may be the potential investors.
§ Mr. EadieThe House will have listened with interest to the Minister's remarks. Not long ago, there was a great deal of scepticism about the question of oil from coal. The Government have made an announcement about the design studies. Is the Minister aware that, according to our information, these matters are about to go out to tender and that one tender has even been placed? Will he confirm or deny that? When will the Government make a firm financial commitment? They have made no financial commitment as such. It would help if the Minister let the country see the colour of the Government's money.
§ Mr. MooreThere is a whole series of points as opposed to questions there. As I made clear on Second Reading of the Coal Industry Bill last Tuesday, that when the point of decision comes, the Government regard the area of coal liquefaction as quite separate from that of the overall limits that they have currently argued in strategy. I should have thought that that was a clear comment and a positive commitment. May we just get to the time when we have actually announced a decision, following the design studies? When that point comes, we can decide whether the Government should commit funds for such a project.