"If all proposals are successful it is estimated they could generate A$7 billion in new investment and create 4,000 direct jobs in the construction phase," Victorian minister for energy and resources Candy Broad said.

Australian Power and Energy Ltd (APEL), an unlisted public company, proposes to develop a 50,000 barrels-per-day gas-to-liquids plant and 500MW electricity generation project.

APEL chief executive officer elect Pearce Bowman said in a statement the company expected construction on the A$5 billion project to begin in late 2004 to early 2005 with commissioning of the plant scheduled for 2007/08.

HRL Developments, also an unlisted public company, proposes to use integrated drying gasification combined cycle technology to construct a commercial power station. It plans to build a demonstration scale plant as an intermediate step.

Loy Yang Power plans to use additional brown coal reserves to fuel a proposed new 1,000MW power station using less greenhouse intensive technology and to repower its existing plant to reduce greenhouse intensity.

Loy Yang Power is owned by CMS Energy , which has a 50 percent stake, and Horizon Energy and Xcel Energy subsidiary NRG Energy, which both have 25 percent shares.

TOUGH CRITERIA

Broad said tough conditions placed on the companies would ensure that greenhouse emmission rates from brown coal discovered at the sites be lower than current levels.

"For projects to proceed to mining stage, they will need to meet specified greenhouse emission targets that are 33 percent to 79 percent better than current Victorian best practice and 24 to 76 percent better than international best practice," Broad said.

She said seven out of the 10 exploration tenders lodged were unsuccessful because they did not meet the government's low emission targets.

The Victorian government called for exploration tenders in October to open up new areas of the state's low-grade brown coal fields, estimated to contain sufficient supplies for at least 500 years usage at current rates.

Brown coal-fired generation currently accounts for more than 90 percent of Victoria's total electricity supply with four major baseload generators located in the Latrobe Valley.