Divide begins over Dale coal hydrogenation proposal

The small Dale Town Hall was standing room only Tuesday evening as more than 75 people filled it in response to news of a potential coal-hydrogenation facility north of the town.

Members of a recently organized group of concerned citizens asked the council to do more research into the company, Riverview Energy Corp, and the potential pollution the plant could create. But several community members and tradespeople voiced support for the new project and the potential for new jobs and economic development.

Speculation on the project began late last year. While the town council maintains that it had been eyeing the annexation of more than 500 acres bordered by County Road 2000N, County Road 2100N and County Road 500E for at least three years, some residents speculate the project incentivized the council to move forward with the annexation last April.

Councilman Ken Beasley said the goal was to make the town and county more attractive for any industry to come to the area. It was done, “to make us more valuable to somebody like this to come in and do something around here,” he said.

Beasley is vice president of the council. He stepped up to preside over the meeting Tuesday in the absence of council president Ray Striegel. In his five years on the council, this was his first time chairing the meeting and the most people he had ever witnessed in attendance.

“It was overwhelming,” he said about the number of people wanting to voice their opinions during the meeting.

The council opened up comments from the group Spencer County Citizens for Quality of Life soon after the meeting started. Their time had been included in the printed agenda for the meeting.

Mary Hess spoke up first. “We are here tonight not to argue or yell but to address to you about our concerns and share with you information we have collected on the proposed coal-diesel plant in Dale,” she read from a prepared statement.

She explained that after attending several meetings last year and asking questions that could not be answered by the council, she was concerned about the council’s ability to make an informed decision to allow the project to move forward.

Santa Claus Doctor Erin Marchand expressed concerns about the feasibility of the project in the U.S. since although similar plants have been proposed, there aren’t any currently operating in the U.S.

“My biggest concern is just that this is a controversial technology, it’s never actually been done in the United States before,” the Dale resident said Tuesday night. “Some people would say, ‘We’ll be the first.’ But I think it speaks legions that it’s been attempted and never fully come to fruition. So my concern is that if they start building this plant and they don’t finish it, we are going to be left with a plot of land that we can’t use and an eyesore that we have to clean up.”

Today, Riverview Energy President Greg Merle explained that this type of plant hasn’t been built in the United States for two reasons: economics and licensing.

“The technology hasn’t been available for license until recently in the United States, and the prior low-cost of Middle Eastern oil has not made direct coal-hydrogenation economically advantageous,” he said today via email. “However, the cost of oil has risen to the point that direct coal-hydrogenation is an economically advantageous way to produce an ultra-low-sulfur diesel that is cleaner than traditional diesel refining.”

During the meeting, Randy Vaal, a Santa Claus resident and retired chemical engineer, explained he had worked for oil companies his entire career. He said he was strongly against the plant for several reasons. In his prepared statement, he explained that he would only pick one for the council to consider Tuesday evening. “I want to tell you that this plant will literally be producing poison,” he said.

He explained the plant would produce hydrogen sulfide—a chemical he is very familiar with due to his experience in the oil business. It is one of the leading causes of workplace gas inhalation deaths in the United States, he said.

According to the plans, the company will use the hydrogen sulfide to create elemental molten sulfur to sell, Vaal explained.

“In my experience, I have never seen a hydrogen sulfide plant located near a town, let alone a nice town like Dale,” he said. “The idea that the board would allow this chemical to be produced near your town or schools is just unbelievable to me. A responsible citizen would never even consider it.”

Vaal added that he is worried about leaks at the plant. “They also claim that it’s not going to leak. That’s not my experience. Any plant that has pipelines, valves, tanks, has leaks,” he said. “If a valve leaks; if a pipeline leaks; a storage tank leaks; then hydrogen sulfide leaks. In close proximity to this chemical, workers are going to die.”

According to Riverview, the plant will convert coal into diesel using a Veba Combi Cracking, or VCC Unit licensed by Kellogg Brown and Root. The technology proposed was created in the 1930s and had been used in Germany as well as Russia and China, according to the company.

The plant will also produce Naphtha, which is used to produce products like solvents, fuel and plastics. The plant is expected to use 1.6 million tons of coal and produce 4.8 million barrels of clean diesel and 2.5 million barrels of Naphtha each year, according to the proposal.

Steve Hurm, director of training at the Boilermakers Local 374 Training Center in Dale, refuted Vaal’s claims explaining that if the company used well-trained union workers, the plant would be feasible and safe.

“When it comes to this type of technology,” Hurm said while motioning to the many men standing towards the back of the room. “The people in this room that represent the union building trades know what they are doing. We do this all the time. We build this technology, and it works.”

He said the project would be good for Dale in providing high-paying jobs. In its press release regarding the project, Riverview Energy has said the project would support more than 2,000 construction jobs and provide “225 permanent high-skilled, good-paying jobs,” to the area.

In response to questions from the Free Press today, Merle stated “VCC, or direct coal-hydrogenation, is a direct process which avoids the coal-gasification step, making VCC a cleaner, more efficient and more economically viable as a coal-conversion technology.  VCC is a unique clean-coal technology that uses pressure and hydrogen to convert coal into ultra-low-sulfur diesel fuel. This process starts with using pressure and heat (but not burning or gasifying) to liquify the coal, to which hydrogen is added to improve the quality of the fuel, and from there any waste residue and sulfur is removed from the resulting diesel fuel — making it an ultra-low-sulfur energy source. The process does not add any pollutants to the water; only those pollutants that existed in the source water prior to the process would remain.”

He added that the hydrogen sulfide Vaal referred to would be directed into desulfurization units that strip the sulfur and make it into a solid. This will prevent it from being dispersed into the atmosphere.

Resident Jim Berger told those in attendance and the council that comparing the proposed plant to those in China was improper due to the highly-skilled people that will oversee the plant.

“You can’t compare China to the United States. We got more people that are skilled to ensure our safety,” he said. “I’m all for it.”

As it became apparent that many of the individuals attending the meeting were there to address the council, Council Attorney Bruce Cissna told the crowd that the council wasn’t making any decisions regarding the project that night.

Hess explained that they were there to begin a conversation. “We want to inform you of what we found out so that when you are ready to make a decision you have it,” she explained.

Council member Deloss Painter pointed out that the approval wasn’t really in the council’s hands anymore. The air permit approval is up to the Indiana Department of Environmental Management, he explained.

Valley Watch editor John Blair told the council the prospects for the project to actually come to fruition were dim due to the cut in funding for Department of Energy loans as well as the fact that coal was not as efficient as petroleum to turn into diesel. “Financing a project that is upwards of $3 billion, where are they going to get that money,” he posited. “Don’t think this is going to be any kind of economic catalyst for the community. In fact, it’s going to divide the community and divide it seriously probably for decades. My suggestion is that you should put it to rest while you can and in any way you can.”

The town still has some steps to go through before the acreage can be considered for industrial use. The Dale Plan Commission will consider rezoning the acreage for industrial use at its meeting on March 22 at 6:30 p.m. at the Dale Town Hall.

If the plan commission makes the recommendation for the new zoning designation, the final approval will be up to the town council.

More information from Riverview can be found here—Riverviewenergy.com.

Spencer County Citizens for Quality of Life has created a website—https://www.noc2d.com/— describing the project and listing their concerns about the proposed plant. The website includes a petition for visitors to sign in opposition to the project.