Construction is expected to begin as soon as possible and plant operations are to begin by November 2012.

The closed-loop facility – which represents a $405 million investment – will employ about 450 people in the first phase and then add another 150 jobs about 18 months later, according to sources.

“This is a miracle for Morristown,” said R. Jack Fishman, chairman of the Morristown Industrial Board. “It’s a prayer answered.”

The announcement was made by FED official Eric Staton, Chief Science Officer. The plant – which will be located on land purchased by FED in the East Tennessee Progress Center near Interstate 81 – will use an optimized coal gasification process co-developed by D4 Capital Holdings, LLC., Battelle Memorial Institute and Dynawave Inc.

The process – which is an improvement over current models in production – uses plasma technology to create extremely high temperatures which turn solid materials to gas, allowing the elements to be captured and turned into new compounds with relatively little loss of energy.

“It also allows us to easily separate out all other elements,” said Staton, “Thus, we will extract harmful byproducts such as mercury and sulfur, and valuable byproducts such as zinc, platinum, iridium, etc and sell them in their pure form.

“Since the energy of the reaction is not used to generate heat, it becomes available for capture as syngas. Syngas can be burned or easily converted to different liquid fuels such as diesel, regular gasoline and jet fuel.”

The syngas at the Morristown facility will be converted to diesel fuel.

Current gasification processes use temperatures of about 3,000 degrees Fahrenheit. The D4 process can produce temperatures more than 100,000 degrees Fahrenheit, but only 30,000 degrees will be required at the Morristown facility.

“Temperatures over approximately 30,000 F can break carbon-to-carbon bonds,” Staton said. “Without the oxygen input, the carbon can be separated and recombined to form CO and eventually syngas. This combination produces 10 times more energy than current methods. The high temperature causes more complete compound destruction with minimal byproducts.”

The upshot is that unlike other coal gasification facilities, the Morristown plant will produces virtually no effluents.

“This is a closed-loop system, with no compounds (emissions) being released and any valuable byproducts captured for resale,” Staton said. “The FED coal gasification process falls far below all EPA standards and will set the standard for new coal gasification technologies.”

The facility will move Morristown and East Tennessee further to the front of the developing alternative energy market.

“We’re extremely pleased that Morristown can be a part of utilizing this technology that provides a clean, safe energy for America, while lessening America’s dependence on foreign oil,” Fishman said. “We’re also thrilled to be able to bring these good jobs to the community.”

According to FED officials, America consumes 24 percent of the world’s oil supply while only processing 2 percent of the world’s oil reserves.

In 2008, the United States produced 1.8 billion barrels of crude oil domestically and imported more than 3.6 billion barrels of petroleum, the major product in crude oil.

“America has made great strides at innovating renewable energy sources such as solar and wind. Although these breakthroughs are to be applauded and supported, they will only be a small part of the solution,” Staton said. “Only through leveraging our natural resources, especially coal, through bio-energy initiatives will the United States reverse its course and control its destiny.”

At full capacity, the plant – which will cost around $405 million to construct, including equipment – will send out 113 tractor trailers of diesel fuel a day, require 100 rail cars of coal every other day and will be in production six days a week.

Training for all future plants will be conducted at the Morristown facility as well. The plant – on 115-plus acres – will be a total of 570,000 square feet with 25,000 of that dedicated to office space. Construction on the plant will begin immediately and the company plans on beginning deliveries of diesel fuel to its customers in the 3rd quarter of 2012.

The D4 process will use a million gallons of water per day but recycle 900,000 gallons kept on a trio of retention ponds on the property.

Essentially, the plant will need 100,000 gallons of water per production day.

The company intends to apply for TVA grants while the Industrial Board will pursue state grants for infrastructure and training.