Oct. 9--An Anchorage Native corporation said this morning it aims to build a new electric power plant on the west side of Cook Inlet -- using coal instead of the region's dwindling natural gas supply.

The 100-megawatt plant would rely on an emerging but proven technology that doesn't require the coal to be mined. Instead, the coal would be transformed into gas underground, according to officials from Cook Inlet Region Inc., which owns several hundred thousand acres in the vast Beluga coal fields.

CIRI proposes drilling wells into coal seams, then injecting oxygen into those wells, causing the coal to combust and become liquid gas. CIRI would then convert the gas into electricity at the new power plant, and sell the power to buyers in the region, such as utilities. In the future, the CIRI project or similar projects in other Alaska coal fields could be used to produce natural gas for heating or export outside of Alaska, CIRI said.

If the project is feasible and obtains regulatory approval, CIRI hopes to start producing gas in 2014. If the company can meet that aggressive timeline, CIRI's would be the first "underground coal gasification" (UGC) plant in the country, said Ethan Schutt, the company's senior vice president for land and energy development.

UGC plants have been built in Australia, South Africa and Eastern Europe. In North America, UGC projects are also planned in Wyoming and Alberta, Canada.

CIRI began weighing the possibility of producing gas from Beluga coal roughly a year ago, after some developers approached the company to discuss UGC technology, Schutt said.

At the same time, CIRI is planning for another local-energy project: developing a wind farm on Fire Island, near Anchorage's main airport.

CIRI is looking at a mix of energy projects -- renewable and non-renewable -- because right now, natural gas is the only game in town. Local consumers are "virtually dependant" on natural gas to heat their homes or turn on their lights, according to CIRI chief executive Margie Brown.

"We think we need a mix of things here," said Brown.

WHAT'S THE COST?

The consumer cost of electricity produced by the CIRI plant would be roughly equivalent to current electricity prices in Southcentral. But it wouldn't face the threat of rising future prices attributable to the region's declining natural gas supply, Schutt said.

The company is envisioning a 100-megawatt plant, about a quarter of the size of Southcentral's biggest electrical power plant, Chugach Electric Association's 385-megawatt Beluga Power Plant.