CIL's Talcher plant faces Indian coal roadblock

The operation of Coal India’s Rs 7,700-crore fertiliser plant at Talcher in Odisha has hit a roadblock: Neither the company nor its partners have the technology needed to run it.

The plant uses the coal gasification process, and has run into trouble for using Indian coal. Compared to the coal available in the global market, which has a maximum of 25 per cent ash content, Indian coal generates 40-46 per cent ash. Hence, it brings down the plant output capacity drastically in a gasification project.

“Petcoke was blended with Indian coal, which brought down the ash content. Nevertheless, it was still 33 per cent, higher than what the usual machinery is tailored to handle,” a source in the know of the development said. He added during the testing phase, the plant’s output capacity dipped to 70 per cent on using this blend.

According to him, machines used globally for coal gasification can handle a maximum 25 per cent ash content. If it is above this mark, productivity falls and the machinery depreciates faster as well.

“It is a unique problem, since the machinery to handle such high ash content isn’t available,” the source said.

The Talcher would be the first coal gasification technology-based fertiliser project in the country.

Coal India officials said the fertiliser projects are part of the company’s diversification plan. Currently, instead of being a pure coal miner, the company is thinking of expanding its mining arm to metals as well and hopes to emerge as a holistic energy company.

Analysts claim it is unlikely imported coal, which is best for this project, will be used.

In December 2014, Coal India, GAIL, Rashtriya Chemicals and Fertilisers, and Fertiliser Corporation of India Limited formed a joint venture company to build the Talcher project from scratch. It comprises a 3,850 metric tonne per day (mtpd) urea plant, a 2,700 mtpd ammonia plant, an 850 mtpd nitric acid plant, and a 1,000 mtpd ammonium nitrate plant.

According to the agreement, GAIL will put up the coal gasification plant and RCF and Coal India will put up the other downstream plants of ammonia, urea, nitric acid and ammonium nitrate.  

For the other three gas-based FCIL projects under revival, where Coal India, NTPC and IOCL has stakes, the bidders who participated in the pre-goods and services tax (GST) era tender have asked for a supplementary bid so that the necessary revisions in their respective bids can be accommodated in compliance with the GST norms.

“For these gas-based fertiliser projects, the gas pipeline to feed the plants will be in place by December 2019,” a Coal India official said, adding the progress in these projects is on track.

The gas line is most likely to be supplied by GAIL.

State-owned NTPC and Maharatna Coal India together floated a joint venture — Hindustan Urvarak Rasayan — in 2016, to revive two 1.27 mtpa (million tonne per annum) FCIL projects at Sindri in Jharkhand and at Gorakhpur in Uttar Pradesh, along with Hindustan Fertilizer Corporation’s Barauni unit in Bihar. At a later stage, IOCL, too, chipped in. 

An estimated Rs 18,000 crore investment would be made in these three projects.