Synthetic Fuels

It is both a great success and a colossal failure. Rising like a mirage from the barren North Dakota prairie, the Great Plains Synfuels Plant is one of the most noteworthy remnants of the frantic era that followed the Arab oil embargo, when the United States spent millions of dollars to develop alternative energy sources. The Great Plains plant showed that the country could produce natural gas on a commercial scale from the West's vast supply of coal.

A B-52 bomber took off from here Friday with all eight of its engines running on synthetic fuel, the first time that a U.S. military aircraft has flown without the kerosene formula that has been used since the advent of the jets. The nearly six-hour flight of the lumbering Stratofortress went off without a hitch, Air Force officials said, lifting prospects for the use of alternative fuel by the military and commercial airlines as they grapple with the high price of crude oil.

A B-52 bomber took off from here Friday with all eight of its engines running on synthetic fuel, the first time that a U.S. military aircraft has flown without the kerosene formula that has been used since the advent of the jets. The nearly six-hour flight of the lumbering Stratofortress went off without a hitch, Air Force officials said, lifting prospects for the use of alternative fuel by the military and commercial airlines as they grapple with the high price of crude oil.

Marriott International Inc.'s third-quarter profit rose 2% as the largest U.S. lodging company used tax credits from its synthetic-fuel business to make up for a drop in hotel profit. Net income was $103 million, or 41 cents a share. Hotel profit fell 12% even as Marriott opened 7,100 rooms, and revenue rose 3.4% to $2.37 billion. Marriott shares fell 9 cents to $28.31 on the NYSE.

The Energy Department, taking a short-term loss of more than $1 billion, announced Friday that it will sell a synthetic fuel plant it helped build in the wake of the energy crisis of the late 1970s. Basin Electric Power Cooperative, based in Bismarck, N.D., agreed to buy the Great Plains coal gasification plant in nearby Beulah for an estimated $600 million spread out over the next 21 years, including about $115 million in immediate payments--far short of the $1.

Twenty months ago, when synthetic fuels programs were still politically popular, Los Angeles-based Unocal had ambitious plans to extract crude oil from Colorado shale deposits--and the Synthetic Fuels Corp. seemed ready to pay for them. The quasi-governmental corporation tentatively promised Unocal $2.7 billion in price supports for the tens of thousands of barrels of oil that Unocal intended to extract each day from shale ore in a proposed second stage of its plant in Parachute Creek, Colo.

A House subcommittee, trying to "cut our losses," voted Wednesday to abolish the Synthetic Fuels Corp. and establish a sharply trimmed synthetic fuel program in the Energy Department. If the 5-year-old corporation awards no more money, as much as $6.2 billion could revert to the Treasury. "If you're looking for ways to save money down the road, this is an easy one," said Rep. Mike Synar (D-Okla.

Unocal said Friday that it has dropped plans for a major modification of its oil-shale operations in western Colorado and won't use a controversial $500-million federal subsidy earmarked for the project. Company officials said they decided the changes, designed to capture and recycle excess heat from the current mining and oil-producing complex, would have cost about $352 million--or 35% more than expected. They also said they were not sure the technology would work.

Meredith Lanz says he nearly "jumped for joy" two weeks ago when he saw President Bush on television promoting the use of methanol to fuel cars as one way to clean up the nation's air. Lanz drives an unexceptional-looking 1983 Ford Escort that runs only on methanol, an odorless, colorless liquid made from natural gas or coal. Widespread use of this "cleaner" fuel, state and federal officials say, could reduce smog levels in Southern California by up to 15%. "Maybe now I'll be able to find more fuel pumps," Lanz said.

It is both a great success and a colossal failure. Rising like a mirage from the barren North Dakota prairie, the Great Plains Synfuels Plant is one of the most noteworthy remnants of the frantic era that followed the Arab oil embargo, when the United States spent millions of dollars to develop alternative energy sources. The Great Plains plant showed that the country could produce natural gas on a commercial scale from the West's vast supply of coal.

Meredith Lanz says he nearly "jumped for joy" two weeks ago when he saw President Bush on television promoting the use of methanol to fuel cars as one way to clean up the nation's air. Lanz drives an unexceptional-looking 1983 Ford Escort that runs only on methanol, an odorless, colorless liquid made from natural gas or coal. Widespread use of this "cleaner" fuel, state and federal officials say, could reduce smog levels in Southern California by up to 15%. "Maybe now I'll be able to find more fuel pumps," Lanz said.

The Energy Department, taking a short-term loss of more than $1 billion, announced Friday that it will sell a synthetic fuel plant it helped build in the wake of the energy crisis of the late 1970s. Basin Electric Power Cooperative, based in Bismarck, N.D., agreed to buy the Great Plains coal gasification plant in nearby Beulah for an estimated $600 million spread out over the next 21 years, including about $115 million in immediate payments--far short of the $1.

Unocal said Friday that it has dropped plans for a major modification of its oil-shale operations in western Colorado and won't use a controversial $500-million federal subsidy earmarked for the project. Company officials said they decided the changes, designed to capture and recycle excess heat from the current mining and oil-producing complex, would have cost about $352 million--or 35% more than expected. They also said they were not sure the technology would work.

Twenty months ago, when synthetic fuels programs were still politically popular, Los Angeles-based Unocal had ambitious plans to extract crude oil from Colorado shale deposits--and the Synthetic Fuels Corp. seemed ready to pay for them. The quasi-governmental corporation tentatively promised Unocal $2.7 billion in price supports for the tens of thousands of barrels of oil that Unocal intended to extract each day from shale ore in a proposed second stage of its plant in Parachute Creek, Colo.

The New York-based oil company said it will sell the stock of the Signal Hill-based company to Air Products & Chemicals of Allentown, Pa., for an undisclosed price. Texaco acquired the unit when it purchased Los Angeles-based Getty Oil last year. The synfuels company employs 140 and recovers methane from 11 landfills; six are in California.

The New York-based oil company said it will sell the stock of the Signal Hill-based company to Air Products & Chemicals of Allentown, Pa., for an undisclosed price. Texaco acquired the unit when it purchased Los Angeles-based Getty Oil last year. The synfuels company employs 140 and recovers methane from 11 landfills; six are in California.

Wise governments, like prudent individuals, hope for the best but prepare for the worst. That's the reason we have things like police and fire departments, unemployment compensation and an army and navy. And it's why we used to have a synthetic fuels development program. Not any more. Congress and the Reagan Administration, influenced by the present oil glut and the softness of world oil prices, are managing between them to abdicate the federal responsibility in this area.