Coal India is advancing a major diversification plan with nearly Rs 50,000 crore in coal gasification investments, as India also reassesses crude import choices amid trade uncertainty. The move places energy security and domestic industrial feedstock at the center of the country’s current energy strategy.
Coal India Limited has lined up three large coal gasification projects that together carry an estimated investment of about Rs 50,000 crore. Chairman and Managing Director B. Sairam said the projects align with the National Coal Gasification Mission and support the conversion of coal into value-added products.
The plan marks Coal India’s biggest expansion beyond conventional coal mining. It also signals a shift toward downstream chemicals and cleaner fuels. Coal India aims to build a stronger presence in industrial feedstock and gas-based products while reducing import dependence over time.
The largest project is a coal gasification-based ammonium nitrate plant at Lakhanpur in Odisha. The facility will produce 6.6 lakh tonnes per annum and will come up through Bharat Coal Gasification and Chemicals Limited, a joint venture between Coal India and BHEL. Sairam described it as Coal India’s first commercial-scale downstream coal gasification project, and he said work is in progress.
Coal India expects to commission the Odisha plant by FY30. The project carries an estimated cost of around Rs 25,000 crore. Ammonium nitrate supports mining explosives and infrastructure activity, and it also serves parts of the fertilizer value chain.
Coal India is also pursuing two coal-to-synthetic natural gas projects, each with a planned capacity of 633 million normal cubic meters per year. These plants will supply cleaner fuel to fertilizer units and industrial users.
One project is planned in Bardhaman, West Bengal, through Coal Gas India Limited, a joint venture with GAIL. Coal India estimates the investment for that facility at about Rs 13,000 crore. The second SNG project is planned in Chandrapur, Maharashtra, with BPCL, at a projected capital outlay of about Rs 12,200 crore.
Coal gasification converts coal into syngas, which contains hydrogen and carbon monoxide. Producers can process syngas into synthetic natural gas, fertilizers, and industrial chemicals. This route supports domestic manufacturing supply chains and gives coal-based assets a wider commercial role.
The coal-to-chemicals push comes as Indian refiners keep Russian crude purchases at low levels while they seek policy clarity on a proposed trade arrangement with the United States. Refiners have reportedly slowed fresh bookings as legal and trade developments create uncertainty.
Together, these developments show how India is balancing short-term fuel sourcing with long-term energy security planning. Coal remains central to power generation, but Coal India’s gasification investments now position the company as a broader energy and chemicals producer with a larger role in industrial growth.