Schobert and his colleagues make the fuel using refined coal oil, which is a byproduct of coke manufacture; the byproduct is mixed at an oil refinery with a product of crude oil called light cycle oil. This mix is then hydrogenated using equipment that already exists at refineries, and then it's distilled into various products -- mostly diesel fuel and jet fuel (about 40 percent of each), as well as some gasoline and heating oil.

Other potential benefits of the coal-based fuel: it can replace the three or four different jet fuels used by the military for aircraft and missiles, and the same fuel can be used in diesel engines if those engines are modified slightly. The fuel could also be used without modification in high-temperature stationary fuel cells for generating electricity, Schobert says.

But significant hurdles remain before the fuel can see widespread use. So far, only 500 gallons of it have been produced, far too little to assess production costs, Schobert says. Nevertheless, he suspects that the coal-based fuel could compete with other fuels.

One cost-related problem, however, is that supply of refined coal oil used in the current process is limited, and prices of it would likely go up sharply with increased demand. "Frankly, we'd probably soak up the entire byproduct market, and the folks that sell those byproduct chemicals are not dopes," says Schobert; "they know what they could do to the price under those circumstances." Schobert is now working on other methods of producing the fuel using oil refinery products.

Before the economics of the process can be evaluated, the fuel will need a significant production run -- probably around 50,000 barrels, Schobert estimates, which could cost tens of millions of dollars. He hopes to raise money for the trial run from the private sector. To this end he's organizing a "summit" this spring to bring together parties such as engine makers and oil companies. Schobert also hopes that airlines will be interested: "They don't need the superior thermal stability that this fuel has, but what they do need is a reliable source of fuel that's at a pretty steady price level."

If the money for such a run does come together, one important step still remains. While they've tested the fuel in a stationary jet engine, eventually, "Somebody's got to put this in an airplane and fly it," Schobert says.