LIGNITE 

Millions of years ago, trees and other plants grew rapidly and when they died they fell into swamps, the swamp water prevented it from decaying and allowing peat to form. After years layers build up, pressure from these layers and heat from below the earth's crust gradually turned it into Ignite.(or Coal)

Read more: http://wiki.answers.com/Q/How_is_lignite_formed#ixzz215moHLqk