§ Mr. Nicholas Wintertonasked the Secretary of State for Energy (1) what information he has as to which countries produce a percentage of their oil needs from coal sources and as to what that percentage is in each of these countries at the latest conveniently available date;
(2) what research has been undertaken recently by his Department into the economic viability of major production of petrol from coal;
(3) what is the most recent estimate of the cost of building in the United Kingdom a pilot plant to develop the technology for producing petrol from coal;
(4) what estimate he has made of the relative costs of producing petrol from coal and from oil from North Sea sources, respectively, what is the cost difference; and if he will make a statement;
(5) what research his Department has sponsored and what information he has from other sources as to the amount of coal required to produce one gallon of petrol under processes for producing oil from coal;
(6) what research has been undertaken recently by his Department, or funded by his Department, into technical matters connected with processes for producing petrol from coal on a commercial scale;
427W(7) what assessment his Department has made of the amount of coal that would be required for conversion into oil to match the current output obtained annually from North sea output.
§ Mr. Giles ShawSouth Africa is the only country known to be producing synthetic transport fuels from coal on a commercial scale, with a total output reported to be equivalent of 50 per cent. of the country's demand for petrol and diesel. The capital cost of two coal liquefaction plants built between 1978 and 1982 was around $6 billion, for a design output of 100,000 barrels per day.
The economics of coal liquefaction are the subject of a study by the economic assessment service, which operates under the aegis of the IEA, with funding from the United Kingdom and eleven other countries. Current work suggests that petrol from United Kingdom coal at current prices would cost about $80 per barrel, compared to $30 to $40 per barrel for petrol from North sea oil. These estimates would depend on assumptions about financing arrangements and revenues from the sale of co-products.
In 1983, the output of North sea oil was around 115 million tonnes. To produce an equivalent output would require the liquefaction of about 350 to 400 million tonnes of United Kingdom coal and require an investment of the order of £100 billion.
Between 9 and 12 kilogrammes (20 to 26 lbs) of United Kingdom coal would be required to make one gallon of petrol.
Between 1979 and 1982, my Department supported design studies and laboratory investigations into two direct coal liquefaction processes then being developed by the National Coal Board. With the NCB, we are now sharing the cost of the design phase of a project to build a 2½ tonne per day (around 7 barrels/day) pilot plant at Point of Ayr in North Wales using the liquid solvent extraction process. The construction cost of this plant was originally estimated at £16 million, but a firmer cost estimate will be available at the end of this year on completion of the current work on the design. The Department and NCB are also contributing to the cost of constructing and operating a 24 kg/day experimental rapid pyrolysis unit in the Federal Republic of Germany. This work will also include economic projections for conceptual full-scale plant.