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Bixby Energy Systems Catches China's Eye With Coal Processing Technology

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As energy policies become more of a global financial and environmental concern, a clean energy company that can successfully develop "green" technologies will be at the forefront of the next energy industry investment wave.

A comment sent in from a Money Morning reader recently addressed a new coal processing technology developed by a U.S. company to make headlines this year.

Do you know anything about a coal processing technology from Bixby Energy Systems Inc.? It sounds interesting.

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Minnesota-based Bixby Energy Systems Inc., a "new-energy" company dedicated to developing clean energy technology, introduced a coal-to-gas conversion process this summer intended to drastically reduce carbon emissions and produce high quality natural gas.

The "Bixby Process"  extracts energy from any carbon-based material to make a synthetic natural gas. It works by superheating coal, instead of burning it, in a closed-loop sealed environment that prevents carbon emissions.   The process is able to extract more than 80% of usable energy from coal – much more efficient than the 31% retrieved when it's burned – and produces a high-quality synthetic natural gas. Utilities running on synthetic natural gas produce up to 65% fewer carbon emissions than those burning coal. 

About 30% – 50% of the superheated coal is turned into synthetic gas during the process, which is also called devolitization. The rest is activated carbon solids. Bixby also developed a liquefaction technology that combines the carbon solids with hydrogen to make a light sweet crude oil – which the company hopes will allow countries to reduce their dependence on foreign oil.

Do you know anything about a coal processing technology from Bixby Energy Systems Inc.? It sounds interesting

"Discussions of energy independence rarely end with the proposal of real solutions. Our liquefaction technology has the potential to provide significant change in the balance of resources, and perhaps to change the current geopolitical and economic landscape," said Bob Walker, chairman, chief executive officer and president of Bixby Energy.

The process will also allow nations with high coal supplies to use a higher percentage those reserves, like the United States. The United States has 27% of the world's coal reserves, according to the Institute for 21st Century Energy.

"The United States has centuries' worth of coal underground," said Walker. "Coal is thought to be a ‘dirty' source of energy. But, in reality, coal is not the culprit. The carbon-emissions problem actually stems from the process of burning coal to produce energy which was developed more than 80 years ago."

Money Morning Contributing Editor Peter Krauth said that Bixby's process is not the only environmentally friendly process designed for coal production. Global energy counterparts have similar technologies to reduce carbon emissions.

Germany's energy giant RWE AG (PINK ADR: RWEOY) burns coal in its plants, but manages to emit almost no carbon dioxide. It has implemented an Integrated Gasification Combined Cycle (IGCC), meaning coal is not burned in the conventional manner, but is instead first converted into a combustible crude gas. The gas is converted into hydrogen and carbon dioxide, captured by carbon capture and storage (CCS) technology before the hydrogen is burned.

South Africa's Sasol Ltd. (NYSE ADR: SSL) employs the Fischer-Tropsch technology to remove sulfur from synthetic gas to reduce emissions. The F-T process uses gas-to-liquids and coal-to-liquids technologies for a cleaner-produced diesel fuel.

But Bixby says its patent-pending process is more advanced than many competitors' "clean coal" processes because it eliminates the need for elaborate and expensive clean energy technologies like CCS.

While U.S. policymakers have given little attention to Bixby's process, the city of Shanxi, China, bought five Bixby conversion units right off the bat in June, generating millions in revenue. The country wants to clean up its image as the world's largest polluter.

China also has large gas reserves but falls short on oil and natural gas, which caused widespread power outages last winter. That makes the Bixby Process ideal for the country's energy needs.

"By the end of this year we expect $12.5 million in revenue [from China] and we expect to more than double that in 2011," said Walker, "And this will create jobs for Minnesotans and others as we expand manufacturing in the United States."

China's interest in Bixby follows the country's trend of investing in foreign-developed technologies to improve policies at home. Money Morning Chief Investment Strategist Keith Fitz-Gerald said investors need to be aware of this trend so they don't miss key profit opportunities in the global energy industry.

"China has very specific long-term energy objectives that are going to result in the complete realignment of the global energy industry. [Deals] like this will continue as long as there is growth in China," said Fitz-Gerald.

 (**) Money Morning editors reserve the right to edit responses for grammar, length and clarity when posting on our Web site. Please include your name and hometown with your email.

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  1. bb69 | December 17, 2010

    Money Morning Contributing Editor Peter Krauth said that Bixby's process is not the only environmentally friendly process designed for coal production. Global energy counterparts have similar technologies to reduce carbon emissions.

    The editor may want to do a better job researching these technologies they are totally different.There is no other technology similar to Bixbys

  2. Snapcap | December 17, 2010

    As noted, Sasol, in South Africa, has been converting coal to liquid for more than 30 years. Also, what the article doesn't say, is how much energy is used to heat the coal to create the synthetic gas?

  3. Jesse S | December 17, 2010

    Great to hear of a U.S. company making head way in the green energy industry. The largest problem is that while companies like this are developing this technology and countries like China are jumping on the bandwagon, politicians in the U.S. are, out of one side of their mouth, saying we need green energy, and out the other side, making deals with current unions and large corporations to stay away from things like this.

    We'll be the ones with mud on our face when these countries pass us up. At least we can hope the manufacturing will stay in the U.S. These type of ideas create more jobs than the government will ever accomplish with a blank check.

  4. M. Engel | December 17, 2010

    All these clean coal technologies described are pre-caveman obsolete compicated overpriced crap. CLEAN DIRT WANTED (c) Journal has described a much simpler solution that actually can make money by removing these contaminants!

  5. R99 | December 18, 2010

    Bixby technology does appear different than other coal gasification systems out there. Bixby claims to be able to gasify the coal with NO carbon emsisions (due to the super-heating rather than burning), while the other coal gasification systems out there still produce the CO2 and then need to capture and sequester it underground. If this is true, then indeed it is "clean coal" and is something new and special. My question is: the article reports that Shanxi, China has bought some of these units, but are any of them yet in operation, doing what Bixby says they do?

  6. FlyGT | December 19, 2010

    Bixby's technology does sound much more efficient and practical. Carbon Capture isn't necessary with the Bixby technology. Instead of burying C02 underground with Carbon Capture Systems which wastes energy and requires building expensive pipelines … plus who knows what's going to happen .. contamination of the earth or leakage of C02 into the atmosphere. Bixby takes the byproduct and converts it to oil. Oil and natural gas out of coal .. sounds like they have a winner.

  7. janet cobb | December 22, 2010

    I read your article about Bixby Energy with great interest, thinking I might finally read about independent verification of Bixby's claims, might finally discover where a demonstration model is in operation, might learn about where these units that are being shipped to China are being manufactured. Nothing. You might consider a follow up article that would include these facts. It shouldn't be too difficult to do the investigation.

    I want Bixby Energy to be a legitamate company with authentic new technology. I have been scouring the internet for information. I have not been able to verify Bixby's claims – yet.

  8. PatG | December 22, 2010

    How do you invest in a private Co. Like Bixby Energy Systems?

  9. Gurney | December 25, 2010

    The same information was on Minneapolis Startribune sometimes in the spriong or early summer of 2010. At that point, Bixby was a private company and has five units sold to China for eval. Is it still a private firm today? Has the trial in Shanxi brought more business yet or is it still under further evaluation?

  10. SP | December 29, 2010

    It is still a private company. There is no stock listing for Bixby on any public exchange at this time. Their press releases indicate that some units have been sold in China. However, I find no press release that indicates any of these units is yet in commercial operation. Surely they would produce a press release with great fanfare when the first commercial unit begins operation, since that would be a significant milestone.

  11. Mark | January 18, 2011

    To me it sounds like the technology just kicks the can down the road.

    What happens with all that "activated carbon"?? Another article said that mercury and zinc were left in the carbon. Bury it?? Use it toi purify water??

    "Light sweet crude"… what is it really?? What can you do with it??

    Their math is funny too.. 80% of energy converted to gas yippee!! but how much of that is lost when they convert it to heat!! My guess is that the math is in favor of coal

    Why no working examples???

    Sounds like snake oil …. or maybe snake syngas

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