Coal gasification project worth Rs 2,400 cr on anvil

A Rs 2,400-crore surface coal gasification project planned by Coal India Ltd (CIL) and GAIL India is expected to move forward, as both the public sector companies have agreed to open a new round of negotiations soon on the project.

“We are going to have a fresh round of talks with GAIL soon on the project. CIL and GAIL will form a 50:50 joint venture for the project,” a top CIL official told Business Standard.

The project has not made any significant headway since the signing of the Memorandum of Understanding between CIL and GAIL India in January 2008. A coal block at Talcher Coalfields under the command area of Mahanadi Coalfields Limited (MCL), a subsidiary of CIL, had been identified for this surface-based coal gasification project.

The process of exploration of the coal block identified for the project would take around 18 months to be completed.

Following the completion of exploration, the relevant data collected would be submitted to a premier mining institute in Russia which would act as the consultant for the gasification project.

The coal reserves in the identified block and cost of the project would be ascertained after the completion of the exploration work.

CIL had also planned an underground coal gasification project with Oil and Natural Gas Corporation (ONGC). The block identified was spread over four sq km and located in the command area of Eastern Coalfields Ltd (ECL), a subsidiary of CIL.

The MoU was in 2007 and the two entities were set to sign a pact for a 50:50 joint venture. While CIL would offer a coal block for the project, ONGC would decide the technology to be used.