Coal India Ltd (CIL), under the aegis of Ministry of Coal, will ink memorandum of undertaking (MoU) with three major PSUs for setting up of coal-to-chemical projects through Surface Coal Gasification (SCG) route on September 27 in New Delhi.

The state-owned miner will be joining hands with Bharat Heavy Electricals Ltd, Indian Oil Corporation and GAIL (India) for setting up four SCG projects, the government said in a statement.

Through SCG route coal is converted into syngas that can be subsequently processed for downstream production of value-added chemicals. These are produced through imported natural gas or crude oil. Some of the end products would be di-methyl ether, synthetic natural gas and ammonium nitrate.

Related Stories
Coal India to sell around 90 mt coal through e-auction route
The state-owned miner has been earning close to ₹4,400-4,500/tonne on sale through e-auction route this year

The proposed projects would not only help reduce forex outgo but would also lead to direct and indirect employment generation to the tune of 23,000.

Twin objectives

With the twin objectives of self-reliance and energy independence, the Coal Ministry has set a target for achieving 100-million-tonne coal gasification by 2030, the release said.

In its latest annual report (2021-22), CIL said it had completed pre-feasibility studies during the year to set up integrated coal-to-chemical plants utilising low-ash coal. These plants are proposed to be located near mine heads of ECL, SECL and WCL to produce methanol, ammonia and ammonium nitrate, respectively. Tendering process was on, it said.

Plans are also on the anvil for setting up a C2C plant utilising high ash coal, to produce ammonium nitrate (AN) at MCL to cater the requirement of coal producing subsidiaries. AN is an important component in manufacture of explosives, extensively used in the mines of Coal India.