India sets 100 million tonne coal gasification target by 2030
02 September 2020
The coal ministry has set a target of achieving 100 million tonnes of coal gasification by 2030, involving investments of over Rs4 lakh crore, union minister of coal and mines Pralhad Joshi has said.
Addressing a webinar for discussing the road map for achieving the target of coal gasification and liquefaction, Joshi said that in order to encourage use of clean sources of fuel, the government has provided for a concession of 20 per cent on revenue share of coal used for gasification.
He said the process of coal gassification and liquifaction will also boost production of synthetic natural gas, energy fuel, urea for fertilisers and production of other chemicals.
The webinar was attended by around 700 delegates from government, CIL and the coal sector.
Joshi said that coal gasification and liquefaction are well in the government’s agenda and various actions have been taken for development of surface coal gasification in India.
He said a steering committee has been set up under the chairmanship of NITI Aayog member VK Saraswat comprising of members from the ministry of coal to address the issues. CIL has also planned to set up at least 3 gasification plants (besides Dankuni) on BOO basis through global tendering and has signed an MOU with GAIL for marketing synthetic natural gas.
Meanwhile, the government has started auctioning out of coal mines for commercial extraction to the private sector in an initiative aimed at attracting global investment in the mining sector.
In all 41 mines with total geological coal reserve of 17 billion tonne and peak rated capacities ranging from 0.5 to 40 million tonne per annum of coal has been offered for private mining. The cumulative PRC of all mines is 225 mtpa.
The mines, located in five states of Chhattisgarh, Jharkhand, Madhya Pradesh, Maharashtra and Odisha, are largely fully explored and could be brought to production immediately.
The terms and conditions of leasing coal mines are very liberal allowing new companies to participate in the bidding process with reduced upfront amount, adjustment of upfront amount against royalty, liberal efficiency parameters to encourage flexibility to operationalise the coal mines, transparent bidding process, 100 per cent FDI through automatic route allowed and reasonable financial terms and revenue sharing model based on National Coal Index.
There will also be complete freedom to use coal production for sale, captive consumption, sale to affiliates, coal gassification and exports. Moreover, exploitation rights for CBM and other minor minerals present in the coalfields would also be provided to miners.
Also, Security creation through mortgage over the coal mine has been allowed for scaling any financing needs. Change in control has also been allowed.