Coal India has outlined an ambitious Rs 50,000 crore investment plan to expand into coal-to-chemicals projects. The move signals a strategic shift toward value-added downstream operations and diversification beyond traditional mining.
With investments of nearly Rs 50,000 crore taking shape across three large coal gasification projects, Coal India Limited is moving into downstream chemicals and cleaner fuels at scale, marking its biggest diversification beyond conventional coal mining as India looks to cut import dependence on industrial feedstock and natural gas.
Coal India is also pursuing two coal-to-synthetic natural gas (SNG) projects, each with a capacity of 633 million normal cubic metres per annum. It is aimed at supplying cleaner fuel to fertiliser units and industrial consumers.
The centrepiece of the push is a coal gasification-based ammonium nitrate plant of 6.6 lakh tonnes per annum at Lakhanpur in Odisha. The project is being developed through Bharat Coal Gasification and Chemicals Limited, a joint venture between Coal India and Bharat Heavy Electricals Limited.
The plant is expected to be commissioned by FY30 and will involve an estimated investment of around Rs 25,000 crore. Ammonium Nitrate is a key raw material for bulk explosives used in mining and infrastructure projects and also feeds into fertiliser production. Domestic manufacturing through gasification is expected to reduce imports of industrial chemicals.
Coal India CMD (Chairman), B. Sairam reported that these projects will be aligned with the National Coal Gasification Mission and intended to convert coal to value-added products while providing energy security to the nation.
The process of converting Coal to synthetic gas (syngas) involves converting coal to hydrogen, carbon monoxide and many other gases. The coal converted to syngas can be used to produce synthetic natural gas (SNG), fertiliser and various industrial chemicals. The national government has created a conducive environment by providing policy incentives (both fiscal and financial) and encouraging public sector companies to participate in the gasification process to support their strategic clean energy transition.
Gasification by Coal India is a fundamental shift in its overall operating strategy - from simply being a supplier of fuel to becoming an integrated producer of energy and chemicals.