The Wall Street Journal-20080125-Peabody Invests in Coal-to-Gas Firm
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Peabody Invests in Coal-to-Gas Firm
U.S. coal giant Peabody Energy Co. has bought a stake in GreatPoint Energy Inc., a Massachusetts start-up company that is among several ventures exploring technology that can turn coal into natural gas.
GreatPoint, which has attracted $140 million in start-up funding, says it can turn coal into gas in an environmentally friendly process at $4 per thousand cubic feet, about 40% below current prices for natural gas. Peabody says that if the GreatPoint Technology proves viable on a large scale, it foresees supplying coal to a gasification plant in Wyoming's Powder River Basin, where it has mines and vast reserves located near gas pipelines to Chicago and the Midwest.
Peabody and Cambridge, Mass.-based GreatPoint declined to say how much Peabody had invested.
The investment marks rising interest in coal gasification technology, which is intended to supply coal-based fuel without emitting the same amount of global-warming gases as when coal is burned.
Such projects could also supply gas in a time of growing demand for the cleaner-burning fuel. General Electric Co. and others have invested in coal-gasification technology, which is often eligible for government subsidies.
Coal gasification faces significant hurdles, and GreatPoint's technology has yet to prove viable on a large basis.
