Ciris Energy Inc., a closely held U.S. company that converts coal to natural gas, raised $15 million from Asia Pacific Capital of Hong Kong in a Series C funding round to commercialize its technology.
The preferred stock offering follows a similar, $10 million investment in February from Asia Pacific Capital, Ciris said today in a statement.
The company developed a technique to inject nutrients into buried coal-seams to stimulate naturally occurring microorganisms that consume coal and emit methane. The process converts low-rank coal into more valuable products such as methane and industrial chemicals, according to Centennial, Colorado-based Ciris’s website.
Ciris is developing an underground project in Wyoming’s Powder River Basin and plans to demonstrate next year a process it’s developing that works above ground, after coal is mined, Chief Executive Officer Jay Short said in an interview. He’s evaluating additional project opportunities in the U.S., Australia and Asia, including China and Indonesia.
Asia has “major challenges in terms of dealing with coal, and they need new energy sources,” Short said. Low-rank coals, such as those present in Wyoming, emit more pollutants when burned, he said. “There’s a large advantage to converting them instead to natural gas. It’s much cleaner.”
Ciris expects that a project producing gas from a 640-acre coal-seam may last for 20 years and generate as much as $250 million in earnings before interest, taxes, depreciation and amortization, Short said. Its 160-acre project in Wyoming will begin commercial production next year, he said.
The company also is backed by ConocoPhillips (COP:US), Braemar Energy Ventures, Rho Ventures LLC, Triplepoint Capital LLC, Lighthouse Capital Partners Inc., Khosla Ventures and Energy Technology Ventures.
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