Two world leaders in coal production and coal-to-liquids technology announced Tuesday they have joined forces to develop a new coal-to-liquids facility in the United States. St. Louis-based Peabody Energy and Denver-based Rentech, Inc., said they would be jointly evaluating potential sites for the facility in the Midwest and Montana under a joint development agreement signed earlier.

Rentech’s proprietary “Fischer-Tropsch coal-to-liquids” process will be used to transform coal that Peabody produces into diesel and jet fuel.

“We’re seeing an overwhelming need for coal-to-liquids developments in the United States to offset reliance on expensive imported oil, and projects like these represent a major part of our energy,” said Peabody CEO Gregory Boyce. “Because of Peabody’s leading reserves, we are uniquely positioned to capitalize on this significant emerging market for coal.”

The proponents said the eventual plant size would range from 10,000 to 30,000 bbl/d. A 10,000 bbl/d facility would uses 2-3 million tons of coal annually, said Peabody’s spokesperson. A 30,000 bbl/d capacity facility would use up to 9 million tons of coal annually.

Peabody bills itself as the world’s largest private-sector coal company, with sales last year in the 240 million-ton area and $4.6 billion in revenues. Rentech similarly is one of the world’s leading developers of Fischer-Tropsch coal-to-liquids and gas-to-liquids technologies.

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