India has taken a major step in coal sector diversification and clean energy transition by signing a land-leasing agreement for the country’s first indigenous Coal-to-Ammonium Nitrate project in Odisha. The project, coming up in Lakhanpur (Jharsuguda district), is being developed jointly by Bharat Coal Gasification and Chemicals Limited and Mahanadi Coalfields Limited.
This initiative marks a significant milestone under the National Coal Gasification Mission (2020) and reflects India’s push towards self-reliance (Aatmanirbhar Bharat) using indigenous technology developed by Bharat Heavy Electricals Limited.
Key Highlights of Jharsuguda Project
- Location: Lakhanpur, Jharsuguda district, Odisha
- Capacity: 2000 tonnes per day of ammonium nitrate
- Investment: ~₹25,000 crore
- Technology: First indigenous coal gasification technology (developed by BHEL)
- Timeline: Expected to take at least 2 years for completion
Contract Allocation:
- BHEL: LSTK-1 & LSTK-2
- Larsen and Toubro: LSTK-3 & LSTK-4
Current Status:
- Site development underway (boundary wall, tree enumeration)
What is Coal Gasification?
Coal gasification is a process of converting coal into gas (syngas) using controlled heating with oxygen and steam, instead of directly burning it.
Output Products:
- Ammonia (fertilisers)
- Methanol
- Synthetic diesel
- Dimethyl ether (LPG substitute)
This makes coal a multi-purpose feedstock for energy and chemicals.
Historical Evolution of Coal gasification
- Origin traced to 19th century London street lighting (coal-based gas)
- Gained importance during World War II (Germany) for synthetic fuel production
- Declined after 1970s oil dominance (OPEC era)
- Revived in 1990s (China, South Africa) for energy security
India’s Coal Gasification Push
- Government approved ₹8,500 crore outlay for promotion
- 7 plants planned, with 3 already initiated (bhoomi pujan completed)
- Policy support includes allowing import of critical equipment (even from China)
Background and Global Context
- India has the 5th largest coal reserves, but limited gasification capacity
- Only operational project: Jindal Steel plant at Angul (~2% of target)
- National Coal Gasification Mission (2020) aims for 100 million tonnes capacity by 2030
Global Scenario:
- China leads with 340 million tonnes capacity
- Coal gasification accounts for 60% of China’s methanol production
- India imports ~90% of its methanol needs
Significance of Project
- First indigenous coal gasification-based ammonium nitrate plant
- Boosts fertiliser production and industrial chemicals
- Reduces dependence on imports (methanol, fuels, fertilisers)
- Enhances energy security and value addition to coal
- Promotes Make in India and Aatmanirbhar Bharat