Coal - Synthetic Liquid Fuels from Coal

That America's great coal deposits eventually will be our principal source of liquid as well as solid fuels is generally accepted. Moreover, the day when synthetic oil from coal will begin to supplement our petroleum supplies does not appear to be far off. The American petroleum industry has not spared effort or expenditure in its attempt to keep pace with the demand for oil, and recent production has exceeded expectations. However, the rapidly rising demand for liquid fuels plus the increasing difficulty of finding and developing the new oil needed even to maintain present production rates make it highly unlikely that oil from domestic wells can fully meet future oil requirements. Therefore, it appears that one or more of the following courses must be followed: 1. Curtail oil consumption. 2. Incr ase imports. 3. Develop new sources such as synthetic liquid fuels. All three courses may well be needed, as it is doubtful that any one of the three alternatives alone can satisfactorily solve the problem indicated by the prevailing trend in demand for oil. Curtailment of oil consumption is not a constructive policy, except where oil is being wasted or coal can be readily substituted as in stationary steam plants. Reduced oil supplies for most uses will curb our economic advancement and, in addition to inconveniencing consumers, will have a pronounced adverse effect on American industry. The oil-burner-manufacturing industry already has been dealt a hard blow. Shipments in the first 5 months of 1948 decreased 70 pct from those in the same period in 1947.1 The effect of a similar cut in the automobile industry can be imagined. A severe prolonged shortage of gasoline could seriously disturb our present economic well-being. It might be pointed out also that even the prospect of a shortage or lack of assurance for the future can discourage buyers of equipment, as occurred in the case of oil burners. An increase in our imports of oil seems to be a necessary expedient for the immediate future. Its advantages are that it will require a minimum of manpower and steel in a time of critical shortages and will conserve domestic reserves. Any major dependence upon foreign sources for our oil supplies should be avoided, however. Other nations are increasing their oil consumption more rapidly percentagewise than the United States and eventually will compete with us for the not unlimited world supplies. In peacetime, foreign countries might restrict ship- ments of oil to this country or impose exhorbitant prices. In the event of war, there is serious danger that such sources would be cut off, and American-developed oil fields overseas might even be used against us. Although synthetic fuels cannot relieve any oil shortage that might develop within the next year or two, an immediate start toward a substantial synthetics industry to supplement petroleum not only could help relieve shortages several years hence but also would help establish the much needed "know-how" for large-scale production. By assuring ample future supplies, such a start would permit sound planning by industries dependent upon oil and maintain or restore the confidence of prospective customers for oil-con-suming equipment. If it is agreed that domestic production of crude oil cannot be expected to meet future domestic demands, that oil rationing in general is undesirable. and that too great dependence on foreign oil should be avoided—and the weight of the evidence supports such conclusions—it is inescapable that commercial synthetic fuel production should be developed to supplement domestic petroleum supplies, which, of course, will furnish the bulk of our requirements for yean to come. Sources of Synthetic Oil The three principal sources of synthetic oil are natural gas, oil shale, and coal. A commercial plant using natural gas is under construction, and expansion of this industry is expected.