Confusing as it may be, chocolate liquor has nothing to do with alcohol. During the chocolate-making process, cacao beans that have been roasted and hulled are then ground into a dark paste called chocolate liquor. This paste is milled with sugar and cocoa butter, cooled and solidified into baking chocolates and confections.
Liquoring can be done at home, according to Nathan Hodge in The Art and Craft of Chocolate:
“Simply put 2 cups (240 g) cocoa nibs into a small food processor and blend away. After 30 seconds or so, you should start to see some liquor begin to form on the outside walls of your food processor. At this point, turn off the continuous feature and pulse the nibs. This is important, because once your dry nibs start to turn into a paste, you’ll want to be careful that the viscosity doesn’t force your food processor to overheat or jam up.
“Pulse on and off for about 2 minutes. Every 30 seconds, open the food processor and scrape down the sides with a spatula so that you're getting an even blend. Scrape the liquor out of the food processor and into a small ovenproof dish. You may want to hold the liquor in the oven at its lowest heat setting until you're ready to use it.”