Mining firm making liquid fuel from coal

Silverado Gold Mines Ltd., a Vancouver, British Columbia-based gold mining and exploration company, is working to enter a new industrial market with its promotion of a coal treatment process, which produces a liquid fuel capable of being burned in oil-fired power generation plants.

Through its wholly owned subsidiary, Silverado Green Fuel Inc., the company is promoting in Asian markets its hydrothermal treatment process for low-rank or sub-bituminous coal found in huge quantities in Alaska.

According to a June 21 company press release, targeted markets for the coal fuel product are in the Heilongjiang Providence in northern China and the State of Gujarat, on the western side of India. Silverado Green Fuel executive Dr. Warrake Willson, who has previously worked as a University of Alaska researcher on low rank coal water fuels, has been meeting with the potential Asian buyers, according to Silverado's CEO Garry Anselmo.

"Silverado is currently working with a number of organizations to develop funding for a small, 5 to 10 megawatt Silverado Green Fuel-fired power generation plant in the State of Gujarat," the press release said.

Anselmo declined to comment further on developments with the Asian marketing project.

Facility would be shuttered mill

The company also is working to convert its shuttered hard rock gold mill facility, about 10 miles west of Fairbanks on Ester Dome, to a demonstration plant capable of processing low-rank coal into a liquid fuel. "The Grant Mill, situated on the Grant Mine, currently contains much of the necessary equipment and ample space in the building to accommodate the remaining equipment," the press release said.

Anselmo told Mining News on June 25 that estimated costs for that part of the project are about $20 million. About half of that would be required for the additional hydrothermal processing equipment and installation, while the remaining half would be to cover costs to run the project for three years.

"We're pushing to complete a project in the United States," he said. "We've got the drawings, the environmental work finished and are ready to go forward."

He declined to comment further on potential funding sources for that Fairbanks-based project proposal. The company previously sought funding from the U.S. Department of Energy through the Clean Coal Power Initiative, but the project was not selected for research spending.