ARRA News Service
News Blog for social, fiscal & national security conservatives who believe in God, family & the USA. Upholding the rights granted by God & guaranteed by the U.S. Constitution, traditional family values, "republican" principles / ideals, transparent & limited "smaller" government, free markets, lower taxes, due process of law, liberty & individual freedom. Content approval rests with the ARRA News Service Editor. Opinions are those of the authors. While varied positions are reported, beliefs & principles remain fixed. No revenue is generated for or by this "Blog" - no paid ads - no payments for articles. Fair Use Doctrine is posted & used.
Blogger/Editor/Founder: Bill Smith, Ph.D. [aka: OzarkGuru & 2010 AFP National Blogger of the Year]
Contact: (Pub. Since July, 2006)
    Home Page

One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors. -- Plato (429-347 BC)

Tuesday, May 10, 2011

Reviving Arkansas’ Economy: Turning Brown Coal into Black Gold

Curtis Coleman, Contributing Author:
Come and listen to a story about a man named Jed
A poor mountaineer, barely kept his family fed,
Then one day he was shootin at some food,
And up through the ground came a bubblin crude.
Oil that is, black gold, Texas tea.
It’s not “bubblin,” but it certainly may be black gold for South Arkansas. It’s some tea Texans have been enjoying for a long time. And it could be a boon for a nation desperately in need of becoming energy independent.

It’s call lignite. It’s considered the lowest rank of coal and is used almost exclusively as a fuel for steam-electric power generation. Because of its low energy density and typically high moisture content, lignite, also known as “brown coal,” is inefficient to transport and is not traded extensively on the world market compared with higher coal grades.

And there are environmental concerns. Primarily because of its latent high moisture content, carbon dioxide emissions from traditional brown coal-fired plants are generally much higher than for comparable black coal plants.

Replace Oil Imports from Venezuela?
A new process under development at the University of Texas at Arlington (UTA) may be about to eliminate all those concerns and turn Arkansas’ 548-year supply of readily available lignite into a brown gold bonanza for Arkansas – and the nation. Some estimates suggest that refined Arkansas lignite can potentially replace all of the oil the U.S. imports from Venezuela annually.

UTA has reportedly developed a microrefinery process that will convert Arkansas’ lignite into “syncrude,” a synthetic crude oil that can be refined into diesel fuel. UTA has “gone quiet” on its technology, reportedly completing its patent and proprietary information protection process. Reports are that UTA plans to license the technology to a commercial partner who will then pay UTA a royalty on each gallon of syncrude produced using its proprietary process.

Requiring a remarkably small footprint allowing it to be moved as needed, a UTA microrefinery can produce approximately 1,000 barrels of syncrude per day. Estimates are that each microrefinery can be constructed for as little as $5 million.

Different from burning coal to produce electricity, the UTA process liquefies the lignite, “instantly” converting it syncrude. Remarkably, the process reportedly produces no carbon emissions and has no “carbon footprint.”

Information available from the Arkansas Bureau of Legislative Research (BLR) and the Arkansas Geological Commission indicates that a UTA microrefinery can produce two barrels of syncrude per ton of Arkansas lignite. Arkansas has approximately 4 billion tons of readily accessible lignite reserves (with some estimates as high as 9 billion tons). Assuming 20,000 tons of lignite are mined each day, 200,000 days – or 548 years – would be required to extract 4 billion tons of lignite from South Arkansas earth.

The estimated cost of producing a barrel of syncrude using a UTA microrefinery is in the neighborhood of $40 although no one I’ve talked to as of yet has known if that cost estimate includes the cost of extraction.

Assuming a $40/barrel production cost, and assuming that the cost of oil drops from its current $100 level down to $80/barrel, the economics are extraordinary and compelling.
• 10,000 tons of lignite mined each day
• Produces 20,000 barrels of syncrude daily
• Market price of $80/barrel produces an annual revenue of $584 million
• Production cost of $40/barrel yields an annual profit of $292 million
• Four billion tons of lignite produces a total revenue of $640 billion

The only thing one can know for certain about these estimates and projections is that they are all wrong (as is the case for all estimates and projections of this nature). The $640 billion question is, “What is the magnitude of the error?”

Projected Impact on Arkansas’ Economy is Enormous
The known facts are more than adequate to make the case for moving forward. The projected impact on the economy of Arkansas is enormous, dwarfing projections for natural gas in the Fayetteville shale.

According to the BLR, studies on potential lignite mines in Clark and Dallas Counties produced these projections:
• 200 full-time employees per mine
• An annual payroll of $14.5 million per mine
• Wage rates from $17.50 to $25.22 per hour for operators with skilled positions higher
• Development cost for each mine: $135 million
• Each mine purchases $18 million of supplies from the local economy
• Each mine provides additional ad valorem tax revenues of $600,000 annually
• Royalties paid to land owners for each mine: $1.8 million annually
• Each mine provides $2 million in state sales tax revenue annually
• Each mine provides an additional $350,000 in state severance tax annually
The Economic Impact Projections for Clark County:
One time impacts:
• Total employment 875
• Total payroll $44 million
• Additional GSP $85 million
Annual impacts:
• Total employment 467
• Total payroll $23 million
• Additional GSP $52 million
Current Economics
• Total employment 10,000
• GSP $622 million

The Economic Impact Projections for Dallas County:
One time impacts:
• Total employment 875
• Total payroll $44 million
• Additional GSP $85 million
Annual impacts:
• Total employment 467
• Total payroll $23 million
• Additional GSP $52 million
Current economics:
• Total employment 3,340
• GSP $186 million
One More Study Needed – To Be Funded by Taxpayers?
Arkansas geologists say that another study is required to be ready to move forward with converting Arkansas’ brown coal to black gold. Core samples need to be taken throughout the target area to determine the locations of readily accessible lignite and the depth and purity of each vein – yielding information critical to profitable extraction and refining. (The last core sample study was done 30 years ago and the samples have deteriorated beyond use.) This study, involving thousands of core samples and costing approximately $3 million, is expected to require up to three years to complete.

A group supporting the development of lignite mining in south Arkansas is working to raise a $2.5 million match for a federal grant to conduct lignite core sampling and a special account has been established at Southern Arkansas University (SAU) in Magnolia. SAU, which has a vested interest in lignite research as a member of the Arkansas Lignite Resources Pilot Program, will be the fiscal agent for the project.

Reportedly Land Commissioner John Thurston’s staff is investigating their available funds to determine if any “unobligated” funds can be directed to this project. And according to a May 2, 2011 news release from SAU’s College of Science and Technology, Arkansas Governor Mike Beebe, who has opposed lignite mining in the past, “has pledged to support the project if funding is available.” Information regarding the terms and strings attached to the federal “grant” (taxpayer money) was not readily available.

I asked Richard Wilson of the Arkansas Bureau of Legislative Research why taxpayer monies (instead of an investment from a private commercial entity) should be used to fund the study. He explained that the UTA technology will not be commercially available for another two years and that the core sample study could take as long as three years. He said public funding of the required study will expedite the commercialization of the project, more quickly lead to private commercial investments and revitalization of the South Arkansas economy and therefore also expedite Arkansas’ tax revenues from the new industry. He said that he expects Arkansas to gain significant new revenues directly from the lignite mining and refining industry via both severance and conversion taxes.

The Arkansas counties that have been identified as having significant lignite reserves include Ashley, Bradley, Calhoun, Cleveland, Columbia, Dallas, Grant, Hempstead, Hot Spring, Miller, Nevada, Ouachita, and Saline counties.  Lignite extraction involves a technique know as “strip mining,” a process that includes returning the topography of the mined area to either its original pristine condition or a landscape desired by the landowner.
Curtis Coleman is the President of The Curtis Coleman Institute for Constitutional Policy and contributing author to the ARRA News Service.

Tags: brown coal, lignite, microrefinery, Southern Arkansas University, syncrude, University of Texas at Arlington, Arkansas, Government and Business, Jobs, Curtis Coleman, The New South Conservative To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
Posted by Bill Smith at 6:47 PM - Post Link


Post a Comment

<< Home

View U.S. National Debt

Don't miss anything!
Subscribe to the
ARRA News Service
It's FREE & No Ads!

You will receive a verification email
& must validate you subscribed!

You Then Receive One Email Each AM
With Prior Days Articles / Toons / More

Also, Join & leave conservative posts & comments on

Recent Posts:
Personal Tweets by the editor:
Dr. Bill - OzarkGuru - @arra
#Christian Conservative; Retired USAF & Grad Professor. Constitution NRA ProLife schoolchoice fairtax - Editor ARRA NEWS SERVICE. THANKS FOR FOLLOWING!

Action Links!
State Upper & Lower House Members
State Attorney Generals
State Governors
The White House
US House of Representatives
US Senators

Facebook Accts - Dr. Bill Smith
ARRA News Service
Arkansans Against Big Government
Alley-White Am. Legion #52
Catholics & Protestants United Against Discrimination
End Taxpayer Funding of NPR
Overturn Roe V. Wade
Prolife Soldiers
Project Wildfire 4 Life
Republican Liberty Caucus of Arkansas
The Gold Standard
US Atty Gen Loretta Lynch, aka Eric Holder, Must Go
Veterans for Sarah Palin
Why Vote for Hillary (Satire)
FB Groups:
Arkansas For Sarah Palin
Arkansas Conservative Caucus
Arkansas County Tea Party
Arkansans' Discussion Group on National Issues
Blogs for Borders
Conservative Solutions
Conservative Voices
Defend Marriage -- Arkansas
FairTax Nation
Arkansas for FairTax
Friends of the TEA Party in Arkansas
Freedom Roundtable
Pro-Life Rocks - Arkansas
Republican Network
Republican Liberty Caucus of AR
Reject the U.N.


Request Via
Article Comment

Links to ARRA News
A Patriotic Nurse
Agora Associates
a12iggymom's Blog
America, You Asked For It!
America's Best Choice
ARRA News Twitter
As The Crackerhead Crumbles
Blogs For Borders
Blogs for Palin
Blow the Trumpet Ministry
Boot Berryism
Cap'n Bob & the Damsel
Chicago Ray Report - Obama Regime Report
Chuck Baldwin - links
Common Cents
Conservative Voices
Diana's Corner
Greater Fitchburg For Life
Lasting Liberty Blog
Liberal Isn't Amy
Marathon Pundit
Patriot's Corner
Right on Issues that Matter
Right Reason
Rocking on the Right Side
Saber Point
Saline Watchdog
Sultan Knish
The Blue Eye View
The Born Again Americans
TEA Party Cartoons
The Foxhole | Unapologetic Patriot
The Liberty Republican
The O Word
The Path to Tyranny Blog
The Real Polichick
The War on Guns
Twitter @ARRA
Underground Notes
Warning Signs
Women's Prayer & Action

Editor's Managed Twitter Accounts
Twitter Dr. Bill Smith @arra
Twitter Arkansas @GOPNetwork
Twitter @BootBerryism
Twitter @SovereignAllies
Twitter @FairTaxNation

Editor's Recommended Orgs
Accuracy in Media (AIM)
American Action Forum (AAF)
American Committment
American Culture & Faith Institute
American Enterprise Institute
American Family Business Institute
Americans for Limited Government
Americans for Prosperity
Americans for Tax Reform
American Security Council Fdn
AR Faith & Ethics Council
Arkansas Policy Foundation
Ayn Rand Institute
Bill of Rights Institute
Campaign for Working Families
CATO Institute
Center for Individual Freedom
Center for Immigration Studies
Center for Just Society
Center for Freedom & Prosperity
Citizens Against Gov't Waste
Citizens in Charge Foundstion
Coalition for the Future American Worker
Competitive Enterprise Institute
Concerned Veterans for America
Concerned Women for America
Declaration of Am. Renewal
Eagle Forum
Family Research Council
Family Security Matters
Franklin Center for Gov't & Public Integrity
Freedom Works
Gingrich Productions
Global Incident Map
Great Americans
Gold Standard 2012 Project
Gun Owners of America (GOA)
Heritage Action for America
David Horowitz Freedom Center
Institute For Justice
Institute for Truth in Accounting
Intercollegiate Studies Institute
Judicial Watch
Less Government
Media Reseach Center
National Center for Policy Analysis
National Right To Work Foundation
National Rifle Association (NRA)
National Rifle Association (NRA-ILA)
News Busters
O'Bluejacket's Patriotic Flicks
Open Secrets
Presidential Prayer Team
Religious Freedom Coalition
Renew America
Ron Paul Institute
State Policy Network
Tax Foundation
Tax Policy Center
The Club for Growth
The Federalist
The Gold Standard Now
The Heritage Foundation
The Leadership Institute
Truth in Accounting
Union Facts

Blogs For Borders

Reject the United Nations

Presidential Prayer Team

Thousands of Deadly Islamic Terror Attacks Since 9/11

FairTax Nation on FaceBook
Friends of Israel - Stand with Israel
Blog Feeds
Syndicated - Get the ARRA News Service feed Syndicated!
ARRA Blog Feed

Add to Google Reader or Homepage

Add to The Free Dictionary

Powered by Blogger

  • To Exchange Links - Email:!
  • Comments by contributing authors or other sources do not necessarily reflect the position the editor, other contributing authors, sources, readers, or commenters. No contributors, or editors are paid for articles, images, cartoons, etc. While having reported on and promoting principles & beleifs beliefs of other organizations, this blog/site is soley controlled and supported by the editor. This site/blog does not advertise for money or services nor does it solicit funding for its support.
  • Fair Use: This site/blog may contain copyrighted material the use of which has not been specifically authorized by the copyright owner. Such material is made available to advance understanding of political, human rights, economic, democracy, and social justice issues, etc. This constitutes a 'fair use' of such copyrighted material as provided for in section Title 17 U.S.C. Section 107 of the US Copyright Law. Per said section, the material on this site/blog is distributed without profit to readers to view for the expressed purpose of viewing the included information for research, educational, or satirical purposes. Any person/entity seeking to use copyrighted material shared on this site/blog for purposes that go beyond "fair use," must obtain permission from the copyright owner.
  • © 2006 - 2020 ARRA News Service
Creative Commons License
Creative Commons Attribution Noncommercial Share Alike 3.0 Unported License.