CENTRAL CITY — In a watershed marred by the ugly after-effects of coal mining, an international company is planning to turn piles of waste coal into profitable power – creating at least 165 permanent jobs and helping to clean up abandoned mine drainage.

With a $900 million, waste-coal-burning power plant in Shade Township, Manhattan-based Sithe Global Power LLC could help treat abandoned mine drainage through both power production and by burning the by-products of past coal operations that now sit in piles in the township, leeching polluted water into the ground and nearby watershed.

“Right now, the coal is laying on the ground, polluting your streams,” said Stephen G. Poje, development senior vice president for Sithe, the project’s owner and developer.

The company has a design for a 300-megawatt power plant and has begun a lengthy permitting process that could include as many as 25 approvals from state, county and local agencies, said permitting consultant Robert J. Golden Jr. of TRC Companies Inc.

The power – enough to run 300,000 residences for a year – will be sold to an electric transmission grid, PJM Interconnections LLC.

At the soonest, the plant could be in production by mid-2013.

“It is an ongoing process,” Golden said.

The coal is to be purchased predominately from PBS Coals Inc.’s Shade Preparation Plant, adjacent to the 200-acre site where Sithe wants to build the cogeneration plant. To minimize truck traffic, Poje said the waste coal would be transported via a conveyor belt from the PBS site south of Central City to the neighboring power plant.

“There is enough waste coal for the next 30 years there,” Poje said. The plans also allow for accepting waste coal from conservation projects.

Over time, the plant could remove about 1.5 million tons of waste coal per year, he said.

The plant would use the cleanest technology available – a circulating, fluidized bed boiler – to convert otherwise useless coal into power, said Paul Shewchuk, project engineering manager for engineering firm WorleyParsons, based in Reading.

If it is economically feasible, water to run the plant could be piped from nearby abandoned mine discharges into Dark Shade Creek – Reitz No. 3 and 4, which discharge 1,500 gallons of AMD per minute, and the Loyalhanna discharge, which gushes up to 1,700 gallons per minute – said Maureen L. Casey, water treatment technical specialist for WorleyParsons.

“That is what we want to do at this point,” she said.

As a by-product, the process would create an alkaline ash, which would be sent back to PBS via conveyor belt and then distributed to conservation groups as a tool to fight abandoned-mine drainage. The ash can be used to balance pH levels in acid-mine drainage areas, Poje added.

“Our intent is to be a good corporate citizen and a good neighbor,” he said.

The facility itself would cover 15 acres of the 200-acre site between Rock Cut Road and Bunker Hill Road in Shade Township.

To run the plant, Sithe will need to hire about 65 workers from management to laborers. Another 100 to 200 employees will be needed to maintain trucks and make deliveries. At the peak of the plant’s construction, Poje said up to 1,200 workers will be needed.

F. Gregory Nadeau, senior project manager for engineering firm WorleyParsons, said as many as 100 engineers could be working on this power plant.

“Everything about power plants is a one-of-a-kind design,” he said.

The company is not the first to contrive such a plan. Others have tried, and failed, to build a cogeneration plant in the same area, with the same goals.

In 2002, Duke Energy Corp., of Charlotte, N.C., did not reach the permitting stage for a cogeneration plant in Shade Township, even after making what its officials called significant investments into the proposal.

Len Lichvar, Somerset County Conservation District director, said locals are hoping that, this time, the plant will be built.

“Most people you talk to will tell you it sounds too good to be true,” Lichvar said. “The indicators so far are that this may well be the real deal.”

Waste coal poses a serious threat to water quality, Lichvar said, but he focused on the benefits the plant could produce by using abandoned-mine drainage, especially from the “infamous” Loyalhanna discharge site.

State officials identified that site at the single largest source of unabated discharge in the Stonycreek River Watershed.

“This may be the best long-term source of AMD treatment we have,” Lichvar said. “We have been stymied with trying to correct that.”

Potential solutions to the “virtually decimated” Shade Creek would be a Godsend if the power plant materializes, Lichvar said.

“This does sound as if this is the most serious proposal of its kind, with the most potential,” Lichvar said.

Sithe already is beginning construction on a similar-scale plant in Clearfield County.

Other cogeneration plants in Cambria County have found success. Two are built in the Ebensburg area, and the Colver Power Project in Cambria and Barr townships has been converting waste coal to electricity for more than 10 years.

Project spokeswoman Gail Landis said the company already has spoken to some local officials and conservation groups and has plans for more meetings.

“We are sensitive to local values,” she said. “We want to approach this in a way that it is a win-win situation for everyone.”

After developing the idea for nearly two years, Poje said, barring any unexpected “fatal flaws,” the project is a go.

“We are filing applications,” he said. “It’s an indication that we feel this is feasible.”