Decatur, Ill., to See Coal Gasification Plant

Apr. 29--DECATUR -- A small St. Louis-based company plans to purchase land behind the Caterpillar Inc. plant to produce synthetic natural gas from Illinois coal.

Secure Energy LLC wants to obtain about 25 acres at the back of the Caterpillar grounds, utilizing a coal-powered boiler constructed in 1980 that was never put into use.

Officials for Secure Energy and Caterpillar signed a nonbinding letter of intent Friday to develop the property.

The plan would not affect any of Caterpillar's approximately 3,000 employees or manufacturing at the plant, said Doug McCallen, senior business manager at the facility.

"We are hopeful this marks a new chapter in the life of this property," McCallen said.

The new facility will create 30 to 35 jobs, in addition to numerous others as a result of the construction, said Lars Scott, co-managing member for Secure Energy.

Scott said the company expects to spend about $100 million on construction of the facility, which would produce synthetic natural gas for the Decatur area.

In the past, coal has been a primary energy source for the Decatur region. However, because of emissions concerns and the cost of natural gas, many facilities, including Caterpillar, switched to natural gas as a power source.

Coal gasification, the process of producing synthetic natural gas from coal, is seen as a potentially sustainable use for Illinois coal.

"As far as energy security for the region and the country, it's a big help in that direction," Scott said.

Before construction begins, the company must secure permits, which Scott hopes can happen by the end of the year.

The plan is to complete the project by the end of 2008, Scott said.

"That would be on an aggressive schedule," Scott said.

Secure Energy has no plans to expand at the Decatur site beyond the 25 acres it plans to purchase.

"I think that will be the maximum we'll see at this site," Scott said.

The plant will use about 600,000 tons of Illinois coal per year, which would be trucked in, Scott said.

The facility will be the first major development project for the small company, which has taken on large industrial projects before. Other coal gasification facilities such as the one proposed for Decatur have been built, including one in North Dakota.

Officials hope the facility will help reduce reliance on foreign energy sources, said Craig Coil, president of the Economic Development Corporation of Decatur and Macon County.

"It fits in well with the direction Decatur is going," Coil said. "We are known as a research and development center on several fronts. Alternative energy is an important part of that component."

[Herald & Review (Decatur, IL) (KRT) -- 05/01/06]