Coal to Liquids

Coal to liquids (CTL) is a process of taking raw coal, gasifiying it to make a syngas, then condensing it using Fischer-Tropsch catalysts to produce light hydrocarbons, which is then further processed into diesel and gasoline. The Fischer-Tropsch process was used by the Germans during World War II and by South Africa since they each had access to coal, but not crude oil. The process of conversion is considered relatively expensive due to the high capital, feedstock, O&M, and A&G costs. As a result, there is fear that if the price of crude oil dips to a certain point, it would make diesel or gasoline derived from CTL uneconomic, stranding the large capital investment of the CTL facility. As a result of this, several in Congress are proposing initiatives for the first few CTL facilities that would help encourage investments, such as government-backed loans and per gallon credits. CTL is also considered controversial because of the amount of CO2 emissions during the process.