Part 1

Liquid Coal Inc. has plans for a plant that would process 15,000 tons of coal a day to make 50,000 barrels of diesel fuel. Out of the daily 15,000 tons, the company’s plan states there will be 3,000 tons of solid residues. Handling the waste and bi-products of the fuel will become a major issue. Furthermore, America uses 9 million barrels of gasoline a day, according to the U.S. Department of Energy. Using these figures, an attempt to replace gasoline with liquid coal would require 2.7 million tons of coal each day.

Where will all this coal come from? According to Peabody Energy, the concept is “a world where our country runs on fuel from Middle America, instead of the Middle East.”

Of course, America’s largest coal producer has plenty to gain. Peabody already produces 10% of America’s energy; liquid coal would in reality be liquid gold for stakeholders of Peabody, Massey Energy, Arch Coal, Kennecott Energy and other coal producing companies. During an industry conference two years ago, Peabody’s chief executive Gregory H. Boyce told those in attendance the value of Peabody’s coal reserves would multiply by ten, to about $3.6 trillion if it sold all of its coal in the form of liquid fuel.

This would explain why the coal industry has taken the fight straight to Washington. The coal industry spent $6 million on lobbying during 2005 and 2006, which happens to be three times the amount they spent annually from 2000 through 2004, according to politicalmoneyline.com. Peabody has actually quadrupled their lobbying efforts to total $2 million since 2004, and recently hired former Presidential candidate and Missouri Governor Richard Gephardt to promote the coal-to-liquid process.

Part 3