The Hindu Business Line : Rashtriya Chemicals may go for coal-based gas as feedstock

Cost-effective method: Mr U.S. Jha (right), Chairman & Managing Director, Rashtriya Chemicals & Fertilizers Ltd, and Mr M. Sundararaman, Director-Finance, at a press conference in Mumbai on Friday. —

Rahul Wadke

Mumbai, July 7 The public sector Rashtriya Chemicals and Fertilizers Ltd (RCF) is contemplating use of coal-based gas as feedstock for its fertiliser plants. The company thinks it could be cheaper than buying natural gas from Reliance Industries Ltd.

According to Mr U.S. Jha, Chairman and Managing Director, RCF, if the landed price of the coal-based gas works out to less than $7 per million British thermal units (mmbtu), the company would go in for it.

The landed cost of gas offered by RIL from its KG basin to RCF is expected to be $7 per mmbtu, Mr Jha told Business Line at the sidelines of the company’s annual general meeting on Friday.

Mr Jha said the closed unit of Fertilizer Corporation of India at Talcher would be restarted for producing the coal-based gas. The reviving cost of the Talcher unit would be about Rs 3,500 crore, and RCF has entered into a joint venture with GAIL (India) Ltd for the project, he said.

Coal gasification converts coal from solid to a gaseous state. This is similar to natural gas and can be used by chemicals, fertiliser and power companies.

Talcher unit, located in the Angul district of Orrisa with abundance of coal supply, has a coal gasification plant and a heavy water plant, besides the urea plant.

Techno-feasibility study

Earlier, addressing the AGM, Mr Jha said: “A techno-feasibility study has been carried out for setting up a chemical complex based on production of synthesis gas from coal. Latest coal gasification technology will be utilised which will allow use of coal with high ash content of up to 30-35 per cent. Survey of several locations around the coal belts in the country has been carried out. On preliminary assessment, the erstwhile site of FCI Talcher appears to be most suitable site in view of certain infrastructure facilities already available and proximity to coal mines.”