Centre's ₹37,500-crore coal gasification scheme gets 7 applications; Adani, NTPC on list

The Centre's coal gasification push has received seven applications in the first round of a ₹37,500-crore incentive scheme, the coal ministry said on Tuesday.

The applications, submitted by the September 7 deadline, include three projects from Adani Enterprises for production of urea, while Gallantt Ispat has proposed a project for direct reduced iron (DRI) and syngas.

NTPC has applied for a synthetic natural gas project, Shyam Sel & Power for syngas and Talcher Fertilisers for urea production.

"When we said reports of 'no takers' were premature, we were confident that industry would respond and it has, decisively. Seven applications in the very first round, including from some of India's largest industrial houses and public sector undertakings, are a clear vote of confidence in the scheme and in India's coal gasification mission," a senior ministry official said.

“The market has spoken, and it has spoken loudly,” the official added.

According to the ministry, the applications will now undergo detailed evaluation as per the scheme guidelines and the Request for Proposal (RFP).

The scheme seeks to promote conversion of domestic coal and lignite into higher-value products such as syngas, methanol, ammonia, urea and hydrogen, while reducing dependence on imports of LNG, urea, ammonia and methanol.

The government aims to achieve 100 million tonnes of coal gasification capacity by 2030, including 75 million tonnes of capacity under the new scheme.

The scheme is also expected to catalyse investments of ₹2.5 lakh crore to ₹3 lakh crore and generate employment across the value chain.

Under the scheme, financial incentives of up to 20% of the cost of plant and machinery are to be provided through a competitive bidding process.

The incentive for an individual project is capped at ₹5,000 crore, while a group of entities can receive a maximum of ₹12,000 crore across multiple projects.

The initiative builds on the ₹8,500-crore financial incentive scheme approved in January 2024, under which eight gasification projects are already under implementation.

Coal gasification involves converting coal into synthesis gas, or syngas, mainly comprising carbon monoxide and hydrogen.

The syngas can subsequently be used to produce fuels, fertilisers and industrial chemicals.

The ministry on Tuesday also opened the second round of applications.

Under the RFP, application windows will open at two-month intervals, providing further opportunities for eligible entities to submit proposals.

Several prospective applicants are at advanced stages of project preparation and are expected to participate in subsequent rounds, the ministry said.