Coal India Limited (CIL) has formalized its entry into the coal gasification and coal-to-chemicals segment through a joint venture with Bharat Heavy Electricals Limited (Bhel), marking a significant move after years of inter-ministerial deliberation. The joint venture, named Bharat Coal Gasification and Chemicals Ltd. (BCGCL), aims to leverage CIL's coal reserves to produce approximately 660,000 tonnes of ammonium nitrate annually.

The project, estimated at Rs 11,782 crore, includes Rs. 1,350 crore allocated for the detailed feasibility report (DFR). CIL holds a majority stake of 51 percent in the venture, with Bhel holding the remaining 49 percent.

PM Prasad, Chairman and Managing Director of CIL, highlighted that the objective of BCGCL is to utilize coal gasification to produce synthesis gas (syn-gas), ammonia, nitric acid, and ultimately ammonium nitrate. Ammonium nitrate is crucial for manufacturing bulk explosives used extensively in CIL's open-cast mining operations.

The plant, located in the Lakhanpur area of Mahanadi Coalfields (MCL) in Odisha, is set to produce 2,000 tonnes of ammonium nitrate per day. CIL will supply approximately 1.3 million tonnes of coal annually from MCL to meet the plant's requirements.