Hamilton Beach 2007 Annual Report Download - page 44

Below: North American Coal’s Falkirk Mine mines lignite coal for Great River Energy. The two companies have formed a 50/50 joint venture, Great American Energy, to dry
lignite coal to enhance its value.
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in North Dakota, Texas, Mississippi and Louisiana. NACoal
has what it believes is the most extensive bank of geological
data on lignite coal reserves in the country. This wealth of
data provides a strategic advantage to NACoal as it works to
identify, prioritize and pursue opportunities to develop new
mining operations. Based on results of these ongoing
analyses, NACoal adjusts its ownership plans for its existing
lignite coal reserves as well as its strategies for securing
ownership or leases for additional reserves. Potential projects
in each of these regions include new facilities for traditional
power generation, coal gasification, coal-to-liquids conversion
and coal beneficiation. NACoal’s potential involvement in
these projects ranges from mining the coal that fuels these
facilities to being a partner in the operation or business
venture. The company believes its reserves are well positioned
for these ventures and is optimistic about the near-term
prospects for opportunities in each of the regions.
Direct coal-fired power generation. The foundation
for identifying new lignite coal mining projects continues
to be the ongoing analysis of power generation supply and
demand in each of the regions where NACoal owns or
controls reserves. NACoal pursues these new business
opportunities as they arise.
Coal gasification. NACoal believes the future development
of coal reserves in the United States will depend greatly upon
the adoption of new technologies. The highly efficient
process of coal gasification produces an emission stream that
allows for CO2(carbon dioxide) capture and sequestration.
For example, since 1984, NACoal’s Coteau Mine has supplied
lignite to Dakota Gasification, the only full-scale and fully
operational coal-to-synfuel plant in the United States. The
plant captures CO2during the gasification process and pipes
it from North Dakota to a customer in Canada, where it is
injected into mature oil wells for enhanced oil recovery.
NACoal is participating in several research projects and is in
discussions with potential customers or partners involving
development of other full-scale coal gasification plants.
Coal-based energy production. The company continues
to invest significant resources in understanding and promoting
technologies for converting coal to liquid fuels. These
projects are beginning to be financially attractive in light of
higher sustained prices for natural petroleum products. For
example, NACoal, in partnership with two other industry
leaders, has formed a company called American Lignite
Energy to explore North Dakota coal-based energy products.
Utilizing lignite coal beneficiation technologies. Over
the past few years, a process to use waste heat from power
plants to dry and enhance the value of lignite coal, known as
coal beneficiation, has been developed by Great River Energy’s
(“GRE”) Coal Creek Station, with support and participation by
The Falkirk Mining Company. In 2007, GRE and NACoal
formed a 50/50 joint venture company, Great American Energy
(“GAE”), to develop, construct, own and operate a lignite coal
beneficiation plant. The facility is expected to be completed in
late 2008 and is expected to supply beneficiated coal to a
proposed new power plant. GAE also plans to offer the
technology and enhanced coal to other facilities, both domestic
and international. NACoal believes this innovative process will