Plans unveiled for a new 'green' industrial era

THE North East is at the dawn of a new “green” industrial era which has the potential to create thousands of jobs after a newly-created business unveiled plans to recover the North Sea’s untapped coal reserves.

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THE North East is at the dawn of a new “green” industrial era which has the potential to create thousands of jobs after a newly-created business unveiled plans to recover the North Sea’s untapped coal reserves.

Newcastle-based business Five-Quarter says there is enough coal left under the sea to “power the world for five years” using a process known as underground coal gasification.

London-based investment bank Numis Securities has been appointed to help raise an initial £30m to launch the production process.

Five-Quarter hopes to be producing energy within two years. Within a decade, with the operation in full production, it believes it will be employing thousands of people directly and indirectly.

And with one eye on the region’s mining heritage Five-Quarter says it will establish a trust, using a proportion of its profits to fund improvements and economic regeneration work in the region’s rundown former mining communities.

Scientists at Newcastle University have been working on underground coal gasification for over five years and have now teamed up with finance experts to unlock the energy potential of the region’s remaining coal seams.

Newcastle University Professor of Practice Harry Bradbury, a director of Five-Quarter, said: “This is a very exciting project for the region which has the potential to create thousands of jobs in the recovery of gas, the construction and operation of the power plants, but also downstream in engineering, manufacturing and support services.”

Last month Five-Quarter secured approval from the UK Coal Authority to recover reserves in a 400sq km area of the North Sea, stretching from the mouth of the Tyne up to Alnmouth.

It paid over £10,000, with the Coal Authority allowed to take royalties as the two billion tonnes of coal reserves are recovered.

Prof Bradbury said: “This has been cooking for four years using our own resources and support from One North East.

“We are now at the stage where we need major investment which will come through a flotation or private equity investment or a combination of both.

“We have advised Numis Securities to draw up a strategy with a view to floating on the market by the end of the year.

“This is a decade-plus project which will involves significant investment. We are also hopeful of receiving cash assistance from Brussels.”

Five-Quarter is confident it will be able to raise £30m, which will come with an initial £5m round to cover the first steps, followed by a further £25m to fund the subsea activities.

Five-Quarter founders include Prof Bradbury and university colleagues Prof Paul Younger, Douglas Robertson, Prof Dermot Roddy, Hexham green energy entrepreneur Bob Hull and vice chairman John Wall, the former head of the corporate finance team at the Newcastle office of PricewaterhouseCoopers.

Prof Younger and fellow academics have refined the underground gasification process for North East coal seams.

It is a process which was first invented in the region of 100 years ago and is used today in Australia and the United States.

It involves drilling into a coal seam and injecting steam and oxygen to release a gas which is then brought to the surface and used to create electricity through a gas turbine and routed to the National Grid.

Five-Quarter intends to capture CO² and then recycle it for storage in the coal seams once the gas has been extracted.

Prof Younger said: “Within two years we expect to have two offshore boreholes with drilling equipment in place, and an onshore power station with adjoining gas recycling and separation facility at a site on the Northumberland or Tyneside coast.”

When operating at full capacity Prof Younger expects there to be around six drilling crews with up to 50 people in each crew. Over 1,000 more staff will be employed in land-based production and processing operations in up to six onshore power plants.

Prof Younger added: “This is a sunrise industry for the North East which will create and sustain thousands of high-technology jobs which can use the coal mining knowledge and skills of the region.

“Three quarters of the North East coal reserves are still underground. North East technology will be able to free this gas, creating a whole new industry from scratch. There is enough gas in this field to power the world for the next five years.”

The directors of Five-Quarter unveiled their plans to some of the region’s senior figures at a meeting in Newcastle last night. These included North East MPs Ian Lavery, Ian Mearns and Catherine McKinnell, Gateshead Council leader Mick Henry and Hilary Knox, the deputy chief executive of the Association of North East Councils.


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