The Hindu Business Line : GAIL plans Rs 800-crore coal gassification plant at Ranigunj

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GAIL plans Rs 800-crore coal gassification plant at Ranigunj — Shell to provide technology

Pratim Ranjan Bose

Kolkata , Aug. 10

GAIL (India) Ltd has firmed up plans to set up a Rs 800-crore coal gassification plant at Ranigunj-Dhanbad coal belt in a joint venture with Royal Dutch Shell. The project is the first of its kind in the country.

Talking to Business Line, the Executive Director (Planning and Business Development) of GAIL, Mr Rajeev Khanna, said the coal gassification project would produce synthesis gas using coal sourced from Eastern, Central and Mahanadi Coalfields.

The gas will then be made available to various industries in the region at $3 per million metric British thermal unit (mmbtu). The rate is comparable to the delivered cost of natural gas from the Krishna-Godavari offshore basin to certain locations in Western India. The detailed feasibility report of the project, for which an international consultant has already been appointed, would be completed this year.

"The project would particularly create opportunities for investment in fertiliser sector in West Bengal and Eastern India," he said.

Stating that Shell's participation in the project will be limited to the supply of technology, Mr Khanna said that negotiations were already at an advanced stage with the Dutch company. "Shell has proven technology in coal gassification and is providing the same to six of the seven proposed coal gassification plants in China." While GAIL has already pegged the production capacity at 2,000 tonne per day, which is comparable to the proposed plants in China, it plans to hike capacity to 3,000 tonne per day. "The ash content in domestic coal is as high as 35 per cent as against 15 per cent in China. Accordingly, to get a comparable amount of gas, we might have to enhance the total capacity."

Meanwhile, negotiations are on with the West Bengal Government to pick up 50 per cent stake and management control in the Greater Calcutta Gas Supply Company, a State PSU. The company has roughly 5,000 customers for its piped cooking gas supply scheme.

The Chairman of GAIL , Mr Proshanto Banerjee, said that due diligence had already been done and detailed discussions with the State Government on the issue were expected to begin shortly.

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