Foundation stone laid for Rs 25,000 crore coal-to-ammonium nitrate project
The foundation stone for Bharat Coal Gasification & Chemicals Limited’s (BCGCL) coal-to-ammonium nitrate project was laid remotely by the President of India, Smt. Droupadi Murmu, and Prime Minister Shri Narendra Modi on June 20, 2026, at Lakhanpur in Jharsuguda district of Odisha.
The project aims to produce approximately 0.66 Million Tonnes Per Annum (MTPA) of Technical Grade Ammonium Nitrate through coal gasification and is among India’s first commercial-scale chemical projects based on indigenous Pressurised Fluidised Bed Gasification (PFBG) technology.
Project structure
BCGCL is a joint venture between Coal India Limited (CIL) and Bharat Heavy Electricals Limited (BHEL), with CIL holding a 51% equity stake and BHEL holding 49%.
Mahanadi Coalfields Limited (MCL), a subsidiary of CIL, is providing approximately 350 acres of coal-bearing land at Lakhanpur for the project. MCL will also supply 0.79 MTY of washed coal and 1.19 MTY of rejects from its Ib Valley washery to meet the project’s fuel requirements.
Investment and approvals
The project is being developed at an estimated investment of more than Rs 25,000 crore. It has received Single Window Clearance from the High-Level Clearance Authority (HLCA), Government of Odisha. The Ministry of Coal has also approved financial incentives of Rs 1,350 crore for the project under the government’s coal gasification promotion initiatives.
According to the project developers, all key statutory and environmental approvals and major clearances have been secured, while lump sum turnkey execution packages have already been awarded.
Coal gasification initiative
The project is aligned with the Government of India’s National Coal Gasification Mission and is intended to demonstrate the commercial application of indigenous coal gasification technology for chemical production.
The facility will convert domestic coal resources into value-added chemical products, with Technical Grade Ammonium Nitrate as the primary output.
Commissioning target
The project is targeted for commissioning by September 2029.
Once operational, it is expected to serve as a reference project for future coal-to-chemicals developments in India and demonstrate the use of domestic technology for converting coal into high-value chemical products.
The featured photograph is for representation only.
