First syngas production imminent for Leigh Creek Energy in South Australia

Leigh Creek Energy ASX LCK syngas production South Australia
Leigh Creek Energy received final activity notification for PCD operations from the South Australian government on 3 September 2018.

Junior gas developer Leigh Creek Energy (ASX: LCK) is on the verge of producing the first synthesis gas (syngas) from its flagship energy project in South Australia after receiving final approval for the pre-commercial demonstration (PCD) stage.

The company today announced it has received the final of three activity notifications required to commence operations at the Leigh Creek Energy project.

With onsite construction and drilling activities already completed, the start of syngas production is anticipated within the 2018 third quarter, Leigh Creek Energy stated.

Leigh Creek Energy managing director Phil Staveley said the company has been working on the approvals process for many months.

“Now that we have received the final document from the regulator preliminary to PCD operations, final preparations for PCD initiation and first gas flow can be completed,” he said.

Successful PCD operations will bring the project a step closer to commercialisation and Leigh Creek Energy’s near-term goal of upgrading its 2963.9-petajoule 2C resource to a 2P reserve in the 2018 fourth quarter.

Following this upgrade, the company plans to begin work on the approvals process for the commercial production of syngas.

What is syngas?

Synthesis gas, or “syngas”, is generated via in situ gasification (ISG), which is a chemical process that converts coal from its solid state into a gaseous form. ISG is also known as underground coal gasification.

Syngas contains methane, hydrogen and other valuable components and can be used to produce electricity directly, or further refined into a variety of products including synthetic natural gas (methane) and ammonium nitrate (fertiliser and industrial explosives).

Leigh Creek Energy believes the remnant coal resources at Leigh Creek in northern South Australia are technically suitable for ISG, in addition to being close to infrastructure.

According to the company, the location also avoids sensitive features such as aquifers, residents, towns, culturally sensitive land or sites of high environmental value.

Shares in Leigh Creek Energy were sitting 9.38% higher at $0.175 following the news by midday trade.

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