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Peabody Energy and White Energy Enter into a Development Agreement
Peabody Energy, Australia's leading coal company, and White Energy Company Limited have entered into a clean coal agreement that would serve to develop a coal upgrading plant in the Powder River Basin. Peabody will have the first right to participate in any new coal upgrading project that White Energy undertakes in North America and China. Further, Peabody has a right to acquire a 15% equity interest in White Energy. The coal upgrading plant would utilize White Energy's patented coal briquetting technology, a mechanical process that upgrades lower Btu coals. The process increases the coal's overall energy content by approximately 35 percent. The resulting product is higher quality, more efficient and cleaner, with lower carbon and other emissions. The upgraded coal can be used interchangeably with high rank thermal coal for a number of applications, including power generation, industrial processes and B! tu Conversion, such as coal-to-gas and coal-to-liquids. Peabody and White Energy are proceeding with engineering design and permitting activities for the first plant that are expected to require up to 24 months. The plant would be built in phases, with the first phase expected to produce more than 1 million tons of upgraded coal per year. Subsequent phases could increase plant capacity ultimately to more than 20 million tons annually.
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