Bharat Coal Gasification and Chemicals Ltd (BCGCL) commenced construction on its ₹25,000 crore coal gasification project in Odisha, marking a significant shift from planning and contract awards to on-site execution. The company has awarded contracts worth approximately ₹15,000 crore, according to its Managing Director, Peeyush Kumar. The project aims to produce technical-grade ammonium nitrate using coal gasification technology, with a planned annual production capacity of approximately 0.66 million tonnes. Once operational, the facility is expected to strengthen domestic chemical production and support India’s efforts to utilise its coal resources for value-added products.
Coal India and BHEL Joint Venture Leads the Project
BCGCL is a joint venture between Coal India Ltd (CIL) and Bharat Heavy Electricals Ltd (BHEL). CIL holds a 51% stake in the company, while BHEL owns the remaining 49%. Kumar confirmed that construction had started and most tenders had been awarded. Of the ₹15,000 crore in contracts placed so far, BHEL has received work worth approximately ₹10,000 crore, while Larsen & Toubro (L&T) has secured contracts valued at around ₹5,000 crore.
BHEL and L&T to Execute Four Major Project Packages
BCGCL has divided the project into four major packages, assigning responsibilities according to the companies’ respective engineering and manufacturing capabilities.
BHEL: Coal gasification and synthesis gas (syngas) purification packages.
L&T: Ammonia synthesis and ammonium nitrate production packages.
The production process will convert coal into syngas, which will then undergo purification before being processed into ammonia. The facility will subsequently use ammonia to produce nitric acid and, ultimately, technical-grade ammonium nitrate. This integrated process will enable BCGCL to convert domestic coal into a value-added industrial chemical.
Indigenous Gasification Technology to Support Chemical Production
The Odisha project is among India’s commercial-scale initiatives to deploy domestically developed pressurised fluidised bed gasification technology for chemical manufacturing. By converting coal into chemical feedstocks, the project aims to expand the use of domestic resources beyond conventional power generation. Its planned ammonium nitrate output will serve industrial applications, particularly mining operations that use the chemical. However, BCGCL has not announced a commissioning date in the available statement. The company has also not disclosed the value of the remaining construction packages or an updated project completion schedule.
₹25,000 Crore Investment Covers Project and Associated Costs
The estimated project cost stands at ₹25,000 crore. According to Kumar, the remaining portion of the overall investment will cover associated expenses, including interest, depreciation and land-related costs. With contracts worth ₹15,000 crore already awarded, the next phase will focus on executing the assigned packages, completing the remaining tendering process and advancing construction. The pace of implementation will therefore depend on progress across the project’s major engineering and construction activities.
Project Supports India’s Coal Gasification Mission
The Odisha project aligns with India’s broader ambition to establish 100 million tonnes of coal gasification capacity by 2030 under the National Coal Gasification Mission. The initiative seeks to promote the conversion of coal into chemicals and other value-added products while reducing dependence on imported resources and chemical feedstocks, including liquefied natural gas (LNG), urea, ammonia and methanol. Coal gasification can provide an alternative route for producing industrial chemicals from domestic resources. Consequently, projects such as BCGCL’s Odisha facility could contribute to India’s chemical manufacturing capabilities and import-substitution objectives.
Odisha Project Secures Key Government Clearance
BCGCL has received single-window clearance from the Odisha government’s High-Level Clearance Authority, an important step in advancing the project. With construction now underway and major contracts awarded to BHEL and L&T, the project has entered a crucial execution phase. The completion of the remaining tenders and timely implementation of the four major packages will be key to progressing towards commercial operations. As reported by urbanacres.in, the Odisha coal gasification project represents a significant investment in India’s coal-to-chemicals sector, with the potential to expand domestic ammonium nitrate production and strengthen the country’s value-added chemical manufacturing ecosystem.
