Techno-economic analysis of producing low heating value underground coal gasification gas in Indonesia

Abstract

Indonesia is currently reviewing the use of underground coal gasification (UCG) technology to utilize deep-seated coal. UCG may exploit the coal deposit that is not feasible for open-pit mines due to its great depths. In this study, the UCG plant in two coal mines, the Kideco Jaya Agung (KJA) and the Indominco (IMM) coal mines, will be compared their economics in producing low heating value gas with a capacity of 170,000 MJ/hour. The UCG plants implement the linking vertical well (LVW) technique combined with reverses combustion linking (RCL). The discounted cash flow (DCF) method is used for financial analysis to determine the minimum selling price of UCG low heating value gas. The study aims to understand the economic feasibility of applying UCG technology to Indonesia’s different characteristics of coal deposits. The results show the minimum prices of the low heating value UCG gas of KJA and IMM UCG plants are USD 3/MMBTU and USD 3.57/MMBTU, respectively. The operating cost of the IMM UCG is higher than that of the KJA UCG plant due to its thinner and deeper coal seams.