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New technology turns coal dust into profits.


Enviro-Fuels Technology Inc. has developed technology to recycle low-value waste materials produced by coal mining and coke production operations, converting them into relatively high-value products that are commercially viable. Coke briquettes produced with the technology are suitable for many industrial applications, including steel-making blast furnaces. Coal briquettes produced with the technology are a clean burning, smokeless fuel suitable for home heating as an alternative to wood. The coal briquettes can be burned in fireplaces and wood-burning stoves.

Proprietary Binding Agent

Enviro-Fuels has developed a proprietary binding agent--perfected over the last 10 years by Justin Neumeier--that allows coal and coke fines to be formed into durable briquettes. The briquettes can be made in various sizes, depending on the application of the product. Typically, the briquettes are similar in size to common charcoal briquettes used for barbecues. The briquettes produced with the technology are durable, clean burning, retain the BTU value of the coal or coke used, are economical to produce, and are suitable for a variety of industrial applications as well as home heating uses.

Enviro-Fuels' coke and coal briquettes are formed by mixing the coal or coke fines with the company's proprietary binding agent and feeding the blended mixture into a briquetting machine. The briquettes are formed by the briquetting machine through the use of dies in which metered quantities of the mixture is placed and pressure applied. "The concept of coal briquetting is quite old, but this new technology is truly state-of-the-art," says Ken Young, president of the Utah company. "We're able to recycle a disposable product that has heretofore caused environmental problems and transform it into a viable product."

Coke Briquettes

Coke is a pure carbon, high heat, clean-burning fuel used primarily in steel-making blast furnaces and other industrial applications. It is made from metallurgical grade coal which is heated in the absence of air in large ovens. Volatile matter is driven off of the coal, leaving pure carbon. Small pieces of coke, known as coke breeze or coke fines, are a waste product of the coke-making process. The coke breeze is not suitable for use in blast furnaces because of its small size and, consequently, is of little value to a steel manufacturer. Enviro-Fuels' tech-nology can convert the low-value breeze into relatively high-value coke briquettes. Independent engineering studies indicate that coke briquettes can be produced and sold at prices that are competitive with high-grade coke.

Coal Briquettes

Coal fines are small coal particles ranging from less than 1/4" in diameter to dust size that are created during coal mining operations. Coal fines are available in abundance worldwide and have historically presented a disposal problem for coal producers. Typically, coal fines are disposed of at or near the mine site in piles or trenches, creating potential environmental problems.

Enviro-Fuels has identified two primary markets for the application of the technology: the industrial market and the home-heating market. Interest in Enviro-Fuels' technology is high within industries that are dependent upon coke as a fuel for manufacturing processes. High-quality, metallurgical-grade coke is in great demand by a variety of industrial users. Coke prices typically range from $100 to $125 per ton. Independent engineering studies conducted for Enviro-Fuels by the independent engineering firm EGY Resource Development Corp. of Salt Lake City indicated that coke briquettes using Enviro-Fuels' technology can be produced at a cost of approximately $40 to $45 per ton. A significant profit potential exists for coke briquette production.

Since the 1970s, emphasis has been placed on alternative fuels for home heating. The most widely used alternative fuel has been wood, with many households installing wood-burning stoves and fireplace inserts. The burning of wood, however, has caused significant air pollution in many communities, resulting in restrictions on wood burning. The Enviro-Fuels' coal briquette is a smokeless fuel. In addition, the binding agent used to form the briquettes traps most of the harmful emissions, resulting in a very clean-burning fuel. The briquette burns well in open fireplaces and in wood-burning stoves, is an economically viable alternative to wood as a heating fuel, and solves a major environmental problem caused by the increased burning of wood over the past several years. Studies conducted by the EGY, indicate that coal briquettes can be produced using Enviro-Fuels' technology at a cost of approximately $100 to $120 per ton boxed in 12-pound boxes, and sold through wholesale distributors for approximately $200 per ton, representing a significant profit potential for the product.

Starting Operations in Early 1992

Enviro-Fuels has leased an industrial building in Price, Utah, in which it installed a prototype briquetting machine at the end of 1991. The company began production earlier this year. The prototype plant produces coke briquettes for applications testing in steel-making blast furnaces. In addition, it will produce coal briquettes for sale to home-heating fuel distributors, several of whom have expressed interest in obtaining product as soon as it is available. Projections indicate that the prototype plant will produce a positive cash flow in the first year of production.

The prototype plant will be used to fine-tune the production processes. In late 1992 or early 1993, the company anticipates having coal and coke production plants on line. A production plant will have capacity to produce up to 130,000 tons of briquettes annually. The cost of a production plant, including buildings, is estimated to be approximately $5 million.

Public Company

Enviro-Fuels Technology Inc. (EVFT) is a publicly held company with approximately 11 million shares of common stock outstanding and 70 shareholders. The stock is currently quoted at Wilson Davis & Co., a Salt Lake City brokerage firm. Funding for the prototype plant has been raised through private placements. It is the intention of the company to sell additional stock through a public offering in the first quarter of 1992 through an S-18 registration to raise additional funds. Following a successful stock offering, Enviro-Fuels intends to take immediate steps to become qualified for listing with NASDAQ.

PHOTO : Ken Young, president (left); and Justin Neumeier, developer of Enviro-Fuel's technology and a shareholder in the company.

Fred Jones is a principal with Houlihan Dorton Jones Nicolatus & Stuart Inc.
COPYRIGHT 1992 Olympus Publishing Co.
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Author:Jones, Frederick McKinley
Publication:Utah Business
Article Type:Company Profile
Date:Feb 1, 1992
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