UNDERWATER coal mining in the North Sea could signal the revival of the industry thanks to a £15m grant.

Five-Quarter Energy, based in Newcastle, plans to create between 400 and 1,000 jobs after it was granted one of the biggest hand outs ever by the Regional Growth Fund.

The company’s ambitious plans rely on being able to extract gasses such as hydrogen and methane from coal seams submerged below the sea which could be burned to create low-carbon energy.

Harry Bradbury, chairman and CEO of the company, said: “Five-Quarter has combined the intellectual rigour of a key spin-off team from Newcastle University with existing, world-class knowledge and technology from the UK mining, oil and gas industries in order to achieve this giant step forward in ‘Deep Gas Winning’.

“We hope to share our success with the wider region, bringing new jobs and regeneration to the North of England and Scotland.”

The company is working with Northumberland Council and the North East Local Enterprise Partnership to establish the UK’s first commercial deep gas winning plant within the newly created Enterprise Zone at Blyth on the Northumberland coast.

The plant will create 600 jobs for skilled professionals who have lost out since the mining sector went into decline.

Steve Stewart, CEO of Northumberland County Council, said: “This substantial award is a great recognition of a visionary project, which will use natural resources creatively and innovatively and which has great potential both for the national energy market and for local job creation.”

There are thousands of billions of tonnes of coal in the depths of the North Sea but it cannot be extracted at the moment because the costs involved are too high. But if deep gas winning proves to be successful then the potential gains are huge.

Mr Bradbury said: “We currently hold licences for two billion tonnes of coal. This area alone contains more energy than has been extracted from the totality of the North Sea during exploitation of its natural gas reserves: the equivalent of approximately 11 billion barrels of oil.”