1. 1 Realistic Coal Solutions to Clean Energy" APEGGA luncheon Calgary, Alberta, Canada Dec. 11, 2008 Paul R. Clark, President Ripley Canyon Resources Ltd., Senior Advisor, Northwest Upgrading

2. 2 Overview of the Presentation Definition of clean coal (carbon) A Short Primer on Coal in the World How do we make coal clean (cleaner) End Uses of CO2 Current events and trends of clean coal Summary

3. 3 My Definition of Clean Coal (Carbon) NOx and SOx and particulate emissions are equivalent to or lower than natural gas combined cycle Heavy metals that accumulate as a result of combustion or chemical reactions are benign The majority of the CO2 generated from the process is captured and stored, sequestered or otherwise not emitted into the atmosphere

4. 4 Energy Content in Alberta Coals  Lignite, subbituminous coals generally used for thermal power  Bituminous coal generally used as coking coal for steel making Anthracite Bituminous Sub-bituminous 14000 Btu/lb 13000 Btu/lb 11000 Btu/lb 9500 Btu/lb Lignite 8300 Btu/lb Alberta plains coal

5. 5 Why is clean coal so important Coal has been and will continue to be for the foreseeable future the main source of electrical power production Coal use for power production is increasing at a phenomenal rate in developing countries Coal is ubiquitous in the world and for many countries, it is there largest energy resource. If the CO2 is captured and not emitted into the atmosphere, the use of coal could be cleaner than the use of natural gas for power production

6. 6 NorWest Global Coal Distribution From Norwest Corp

7. 7 Coal Deposits in Canada

8. 8 Genesee 3 – 450 MW Coal-Fired Plant First supercritical plant built in Canada, owned 50% by EPCOR and 50% by TransAlta Environmental controls, including FGD and fabric filters, reduce NO x, SO 2 and particulate emissions well below provincial standards This plant has an efficiency of 10% better than Alberta average $695 million facility The license to operate requires EPCOR to offset its CO2 emissions down to Natural Gas Combined Cycle levels

9. 9 How do we make coal (carbon) cleaner by removing the CO2 Existing Plants  Oxy-fuel  Amine or Sorbent Recovery New Plants  Integrated gas combined cycle (IGCC) using gasification  Methanization  Ultra Super-Critical with carbon capture

10. 10 Amine Recovery-Post- Combustion Capture Flue Gas from Plant CO 2 Stripper Reboiler CO 2 to Cleanup and Compression Cleaned Flue Gas to Atmosphere CO 2 Stripper Absorber Tower Issues - High amine regeneration heat load - Fate of mercury in amine system Steam

11. 11 Amine (post combustion capture) Advantages Can be retrofitted to existing plants Can use the low grade waste heat to help increase the efficiency of the process Concerns Not technically proven at power production plant scale Fate of mercury in the flue gas stream Regeneration of the amine parasitic to the overall efficiency of the plant

12. 12 Oxyfuel Combustion Air Nitrogen Coal Flue gas ~97% CO 2 Boiler Drier Water Air Separation Compressor G Turbine Generator Feed Pump Oxygen Flue Gas (~97% CO 2 ) Recycle ~75% Issues - Boiler performance with recycle flue gas -Air entrainment - Power consumed for oxygen production -Quality of CO 2

13. 13 Oxy-Fuel Combustion Advantages Can be retrofitted to existing plants Produces a CO2 flue gas with no nitrogen Concerns Not technically proven at power production plant scale Fate of mercury in the flue gas stream Oxygen plant parasitic to the overall efficiency of the plant which results in more CO2 being created and lower plant efficiency

14. 14

15. 15 Integrated Gasification Combined Cycle with CO 2 Extraction Fuel Preparation Gasifier Gas Cooling Gas Cleaning Shift Reactor CO2 Extraction Gas Turbine Waste Heat Boiler Steam Turbine CO2 Cleanup & Compression Air Coal Water Slag Sulphur, Mercury & Particulates CO2 to Pipeline Hydrogen Flue Gas To Atmosphere Electric Power Electric Power Air Separation Plant Oxygen

16. 16 Polygeneration Potential of Gasification H2 (upgrading) Coal, coke, etc. Gasification Synthesis Gas Methanol Methyl Acetate - cellulose - lacquers/paints - perfume - pharmaseuticals - synthetic flavoring Acetic Anhydride - cellulose acetate - fiber - pesticides - aspirin/acetaminophen Power & Steam (Electricity) Naphtha Waxes FT Diesel Car Fuel Acetic Acid - food preservative - cellulose - lacquers - plastics - rayon - solvents Town Gas (low cost/low grade gas) Ammonia & Urea (fertilizer) Dimethyl Ether - aerosol propellant - refrigerant - fuel in welding Ethylene & Propylene - food ripening agent - plastics - fibers - solvents - coatings CO 2 (EOR, sequestration, ECBM) Adapted from Eastman Chemicals

17. 17 Eastman Chemicals – Gasification Since 1982

18. 18 Advantages of Gasification Carbon capture integrated into the process and capture can be achieved at a relatively low cost No NOx (Nitrous oxides) Low cost and high efficiency mercury capture Produces other marketable products through the gasification process Uses less water than a pulverized coal plant Deals with heavy metals which are encased in the slag produced

19. 19 Concerns with Gasification Not suitable for retrofitting to existing plants, so most PC plants would still be operating for some time in the future Higher cost than PC plants Not considered technically proven by many The production of power is one of the least value added products from gasification today Difficult to finance

20. 20 The Great Plains Synfuels Plant is shown in the foreground in Beulah, North Dakota; Antelope Valley Station in the background.

21. 21 Methanation Process Steam carbon C+H20 =CO+H2 Water gas shift CO+H20 = H2+CO2 Hydro-gasification 2H2 + C = CH4

22. 22 Ultra Super-Critical Potential of 45-50% efficiency Focus of development work in Europe Motivation is high fuel costs Requires dramatic improvements in materials technology because of the high temperatures and pressures Because of higher efficiency, can reduce CO2 emissions by more than 30%

23. 23 Geological Sequestration of Carbon DioxideReginaEstevan Bismarck North Dakota Montana Manitoba Saskatchewan Canada USA Weyburn Beulah

24. 24 Value of Enhanced Oil Recovery

25. 25 Sleipner Project –North Sea

26. 26 Geological Formations to Store CO 2 from Major Point Sources

27. 27 Current status of clean coal (carbon) Gasification projects booming in China but not to produce power – mostly chemicals and fertilizer Clean power projects that have been announced have been shelved because of high cost (Saskpower, Tampa Electric) and uncertain regulations, ie CO2 UK not supporting IGCC but are very interested in post combustion cleanup. Many clean power projects have been announced in the US to take advantage of subsidies, but few are at the permitted or construction stage

28. 28 Current status of clean coal cont’d A lot of research and demonstration being done on a back end capture of CO2 EPCOR proceeding with a $33 million front end engineering study for a 275 MW IGCC plant at Genesee Developers in the US are turning to petcoke as a low cost, high BTU, low moisture feedstock as an alternative to coal One Alberta upgrader (Opti-Nexen) is gasifying their asphaltenes to produce H2 and power for their own use. Other planned upgraders do not find it economical to produce power, only hydrogen

29. 29 Summary Today Tight gas and shale gas production in the US has provided ample gas supply which has helped to keep natural gas prices low. Natural gas is the base case for new power generation Capital costs for gasifiers have increased significantly world wide The majority of coal power plants being built today in the world are supercritical without CCS, which have lower emissions and higher efficiency than the vintage subcritical plants The focus for new power generation is on renewables

30. 30 Summary (continued) Tomorrow Coal plants will remain as the largest producer of electricity. Some will have CO2 mitigation Renewable energy will become mainstream and will overtake gas Nuclear will have a resurgence but costs will be high The penalties for emitting CO2 will rise and CO2 markets will emerge Carbon capture and sequestration will add significant costs to coal power generation Power may become a by-product in the production of other higher valued products