Peat Resources – Positive environmental implications

Peat Resources – Positive environmental implications

06 May 2010

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Canada — Canada in general and Ontario in particular have been champions of the development of clean energy sources. There are number of clean energy projects in the province from solar to wind power and the provincial government has been encouraging companies to embark on clean energy projects. Clean energy can also be generated through peat fired power plants and several European countries such as Finland and Ireland are currently burning peat as a clean alternative to coal.

Concerted efforts are underway in Canada as well, to use peat as an energy source. Scientists at Lakehead and McMaster Universities recently completed a research on the subject on the peatlands of northwestern Ontario. The research was carried out under the Atikokan Bioenergy Research Centre, funded by the Province of Ontario through the Ontario Centre for Excellence – Energy. Canadian Venture listed Peat Resources Limited (TSX.V: PET) was a contributing private sector partner to the programme.

Field studies were carried out in 2007-2009 near Upsala, about 130 km northwest of Thunder Bay, on peatlands held under permit by PET and were part of an investigation of the environmental effects of wet-harvesting peat as an alternative biomass energy source for the OPG Atikokan Generating Station. The research was directed by Dr. Peter Lee (wetland biologist, Lakehead University) and Dr. Mike Waddington (peatland specialist, McMaster University).

The project arrived at several important conclusions favouring peat harvesting and their use in power plants. PET intends to use wet harvesting which does not require pre-drainage of the peatland. Since the upper growing layer of the bog can be preserved and, after harvesting of the underlying fuel-grade peat, can be rehabilitated as part of a functioning wetland there is no environmental damage. In contrast, the dry harvesting method of peat production used in Europe and in horticultural peat operations elsewhere in Canada requires complete pre-drainage and clearing of the site causing significant environmental change.

The research has shown that the abundance and diversity of plant species in the rehabilitated harvested areas are comparable to those in adjacent natural areas. In fact, growth of sphagnum moss, the principal plant in these types of peatlands, was found to be enhanced in the rehabilitated zones.

Peatlands perform an important environmental function. In their natural state, peatlands are both emitters (methane) and absorbers (carbon dioxide) of greenhouse gases and are a net carbon source to the atmosphere. Removal of the fuel-grade peat, which PET expects to do, reduces the methane emissions and enhanced growth of the mosses in post-harvest areas increases the sequestration of carbon dioxide. Appropriate selection of harvesting sites can therefore result in a net reduction of greenhouse gas emissions thus making the project even more environmentally friendly.

Results of these investigations are relevant to the efforts of PET which is developing peat fuel pellets for power generation. The research confirms the minimal environmental impact of the production of this sustainable bioenergy resource. The results are also timely; the recent interest in mining developments in the Ring of Fire area of northern Ontario indicates a future need for large amounts of reasonably-priced power which the use of peat fuel can help to facilitate.

We have been following PET or some time and are encouraged by their commitment to the project and the progress they have so far made. The Company has identified large biomass resources of fuel-grade peat on its properties in Ontario and Newfoundland. The north-western Ontario property contains over 200 million tonnes, sufficient to supply OPG’s (Ontario Power Generation) northern generating stations for more than 20 years. In Newfoundland, permits cover about 130,000 hectares of productive peatlands.


Peat Resources

Peat Resources Limited was formed to explore, develop and produce high quality peat fuel for use in electricity generating stations and other facilities requiring a long-term assured supply of economically and environmentally attractive fuel. In response to market opportunities and in order to establish a strong resource base, the company has focussed its activities in the Canadian provinces of Ontario and Newfoundland and Labrador.

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