In a significant boost to India’s coal gasification ambitions, Bharat Coal Gasification and Chemicals Limited (BCGCL) and Mahanadi Coalfields Limited (MCL) have signed a land leasing agreement for a large-scale coal-to-ammonium nitrate project at Lakhanpur in Odisha.
The project, with an estimated investment of around ₹25,000 crore, is a major step towards value-added utilisation of coal and aligns with the government’s push to transform the sector beyond conventional combustion.
The upcoming facility is designed as a 2,000 tonnes per day (TPD) ammonium nitrate plant, making it one of India’s first major coal gasification-based chemical projects using indigenously developed technology by Bharat Heavy Electricals Limited (BHEL).
Spread across nearly 350 acres of land under MCL, the project has been enabled by recent policy reforms that allow the utilisation of coal-bearing area land for gasification projects, opening new avenues for diversification in the coal sector.
The initiative is also backed by government incentives, including financial support under the coal gasification scheme, aimed at accelerating adoption of cleaner and more efficient coal utilisation technologies.
Execution of the project is already progressing, with major engineering and construction packages awarded to leading companies such as BHEL and Larsen & Toubro, while initial site development activities are underway to maintain timelines.
Officials have highlighted that coal gasification can play a transformative role by reducing import dependence on chemicals and feedstock, conserving foreign exchange, and supporting domestic manufacturing under the Atmanirbhar Bharat vision.
Once operational, the project is expected to strengthen India’s energy and chemical ecosystem, while also contributing to industrial growth and economic development in Odisha through increased value addition and localised production.