Centre approves incentive of Rs 8,500 crore for coal gasification projects
NEW DELHI: In a bid to achieve the target of coal gasification of 100 million tonne (MT) coal by 2023 in India, the government on Wednesday approved Rs 8,500 crore incentives.
Coal gasification is a thermo-chemical process that converts the black diamond into a synthesis gas or syngas, and this technology can substitute the imports worth Rs 1.3 lakh crore of the country. It can yield methanol that can used to blend with petrol, Di-Methyl Ether (DME) to be blended with LPG, ammonia for manufacturing urea and ammonium nitrate and steel making through gas based direct reduced iron route to substitute imported coking coal in blast furnace and production of synthetic natural gas (SNG).
“We went to the cabinet and we have sanctioned an outlay of Rs 8,500 crore towards incentive for coal gasification projects. The financial assistance has been made under three categories,” said the coal minister Pralhad Joshi.
As per the cabinet decision, the then total outlay of Rs 8,500 crore will be provided under three categories. “Since our coal has high-ash content, there is limited technology available for gasification of such coal. We need to encourage both domestic and international players to invest in coal gasification so that more R&D can happen, boosting indigenous and innovative solutions,” said Joshi.
The cabinet also approved setting up of Coal-to-SNG Project at ECL (Eastern Coalfields Limited) command area through a joint venture of CIL (Coal India Limited) and GAIL and Coal-to-Ammonium Nitrate Project at MCL (Mahanadi Coalfields Limited) command area through a JV of CIL and BHEL. These projects will be completed by 2028-29.