Water was injected into underground reservoirs at depth of between 1000m and 2000m to replicate carbon dioxide released from the production of electricity by burning coal.

An international peer review of the results has now confirmed the tests were successful in determining that the local geology could support the clean coal technology. ZeroGen has now mapped out the area for a second round of tests to locate the best saline aquifer for storing large quantities of CO2.

Queensland Premier Peter Beattie told delegates at a climate change and business conference last week that the project opened the way for the development of clean coal-fired power.

"The ZeroGen project is an advanced feasibility study that is examining the technical and financial viability of using a coal-based gasification plant integrated with carbon capture and storage to generate safe, reliable and environmentally responsible baseload electricity with reduced carbon dioxide emissions," Beattie said.

"The company has informed me that the Drilling Program 1 results delivered in the analysis of geology for carbon storage have been a success, proving that the geology in the Northern Denison Trough is suitable to safely inject and store CO2 in saline aquifers.

"Put simply, ZeroGen has found in this first stage that they can safely store and inject CO2 into saline reservoirs.

"This will assist in locating reservoirs suitable for the long-term, safe storage of CO2, which is fundamental to any clean coal technology. So it's a big hurdle successfully cleared."

Where conventional coal-fired power stations burn pulverised coal with air to raise steam that is then used to generate electricity, gasification combines coal with a mixture of oxygen and steam under pressure to produce a clean synthesis gas (syngas), according to ZeroGen.

ZeroGen says the application of gasification on a large scale, when combined with CO2 capture and storage (CCS), can reduce CO2 emissions from coal-fired power plants to near zero levels.

ZeroGen will now advance to the second drilling test in a bid to locate a reservoir with sufficient capacity for the project.

The company's feasibility tests will also investigate ways the company can reduce technical and commercial risks associated with the carbon capture and storage process.

The feasibility study is expected to be completed by the end of 2008.

ZeroGen is a subsidiary of Queensland Government-owned Stanwell Corporation.