India has provided INR460bn ($4.8bn) for the first phase of coal gasification, coal minister G Kishan Reddy said on Friday. Speaking in New Delhi, he said the plan turns coal into syngas, ammonia, urea and methanol. In turn, that should cut imports of these products.
Why India wants coal gasification
Coal still meets 55% of India’s primary energy needs and 74% of its power generation, Reddy said. Meanwhile, India imports over 85% of its crude oil. Gasified coal could replace some imported fuels and chemicals, so the government sees it as a way to save foreign exchange.
According to Reddy, the ministry has completed MoUs after auctions, and the work is now speeding up. In addition, the ministry wants local technology rather than imported designs.
The wider plan
India has already approved a separate INR375bn ($3.95bn) gasification scheme, CNBC-TV18 reported. The goal is to gasify 100mn tonnes of coal by 2030. Also, the government plans to finish all 25 plants within five years, with four under-construction projects due within a year.
However, the government has not said how much LNG or LPG gasified coal could replace.
For context on coal supply, read our report on India’s coal stockpiles.
