Leigh Creek Energy Limited (ASX:LCK) has achieved 13 days continuous production of commercial quality syngas from a pre-commercial demonstration plant (PCD) in South Australia.
Another PCD milestone is 89 days of continuous syngas production.
Data and production results indicate the Leigh Creek Energy Project (LCEP) has reached stable production within the gasification phase whilst operating at low flow rates.
As of December 29, 2018, the PCD was producing all gases required to make ammonia and urea, while results from this week show the same gases are still being generated.
The results show syngas is now producing up to 20% methane.
Successful production of syngas demonstrates that LCK can produce nitrogen, carbon dioxide, carbon monoxide and hydrogen.
Pathway to commercialisation
LCK managing director Phil Staveley said: “After careful and expert management of the gasifier, the production of gases needed for ammonia and urea is now occurring.
“The process of achieving commercial quality of syngas production is a statement to the industry and our stakeholders that the technical risks of operating in-situ gasifiers at the Leigh Creek site have been drastically lowered.
“Once we achieve commercial rates of gas flow and associated data we will look forward to providing further detail on the pathway to commercialisation.”
LCK is working on increasing flow rates to inform the technical feasibility of In Situ Gasification (ISG).
The LCEP will produce high value ammonium nitrate products, including fertiliser and industrial explosives, from remnant coal resources at Leigh Creek, utilising ISG technologies.
Rights issue to raise $3.86 million
LCK is also conducting a non-renounceable rights issue to existing shareholders to raise about $3.86 million with proceeds to be used for project development and general working capital.
The offer is on the basis of one new share for every 15 shares held at the record date.
At 12 cents per share, the offer represents a 15.85% discount to the 5-trading day volume weighted average closing price of shares as at December 14.
- Jessica Cummins