State-owned enterprise Solid Energy has chosen its former Mataura mine site as the preferred location for an up-to-$25-million demonstration briquetting plant.
• Briquette plant proposal a step in the right direction
The plant, which could be operational with 12 full-time staff by early 2012, will convert raw lignite to low-moisture, high-energy briquettes.
Solid Energy's general manager of conversion, Greg Visser, said yesterday construction of the plant could begin in May this year, subject to consent applications to the Gore District Council and Environment Southland which will be lodged shortly.
The consent applications are expected to be hotly contested by environmentalists, who have opposed proposals to mine and process billions of tonnes of southern lignite.
The former Mataura mine site of the proposed briquetting demonstration plant is south of Gore, past Mataura township on Craig Rd off State Highway 1.
"If it's successful and matches expectations - both for domestic [industrial use] and export volumes - it could lead to a larger commercial plant," Mr Visser said.
However, a construction starting date for the plant was dependent on the "time required to work through the [consent] process".
The demonstration plant's full capacity would be used, processing about 10,000 tonnes of raw lignite a month from Solid Energy's nearby New Vale mine, to produce 90,000 tonnes of briquettes a year.
The conversion process upgrades the inferior quality coal by removing significant amounts of moisture, increasing its thermal value and reducing its emissions.
Mr Visser stressed the potential commercial export volumes would determine whether a larger commercial plant was viable.
Such a plant would be able to supply more than 1 million tonnes of briquettes annually.
However, Mr Visser emphasised the decision on the viability of a larger commercial plant would be made only once the demonstration plant met Solid Energy's objective of producing low-moisture, higher-energy briquettes which proved their value in New Zealand and international markets.
Solid Energy is leading several investigations into the use of an estimated 15 billion tonnes of lignite in Southland and South Otago.
Options include processing it into briquettes or transport fuel or using it in urea fertiliser technologies, the latter in partnership with Ravensdown.
