BCGCL starts construction work on Rs 25,000 cr gasification project, Rs 15k cr work awarded

New Delhi: Bharat Coal Gasification and Chemicals Ltd (BCGCL), the joint venture of Coal India Ltd (CIL) and BHEL, has started ground construction activities for its Rs 25,000 crore coal gasification project in Odisha, with most of the tenders awarded, its Managing Director Peeyush Kumar said on Thursday.

The development assumes significance in the wake of the country's push to build 100 million tonne of coal gasification capacity by 2030 under the National Coal Gasification Mission, aimed at converting coal into chemicals and bringing down the import dependence on products such as LNG, urea, ammonia and methanol.

"We are going ahead with the joint venture of BHEL and Coal India, which is BCGCL....I am happy to share that we have started ground construction activities... Most of the tenders have been awarded and construction has started," Kumar said during the 17th Edition of Gasification India 2026 organised by Mission Energy Foundation.


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BCGCL-a joint venture in which CIL holds the majority 51 per cent stake and Bharat Heavy Electricals Ltd (BHEL) the remaining 49 per cent-has been established to develop a state-of-the-art coal-to-ammonium nitrate project.

Kumar said that the contracts worth about Rs 15,000 crore have already been awarded, while tenders for the remaining works are yet to be awarded. The balance of the project cost comprises soft costs, including interest, depreciation and land-related expenses.

"Out of Rs 25,000 crore, Rs 15,000 crore of work has already been awarded. Of this, Rs 10,000 crore has gone to BHEL and Rs 5,000 crore to L&T," he said.

The project is aimed at producing approximately 0.66 million tonnes per annum of technical grade ammonium nitrate through coal gasification and represents one of the country's pioneering commercial-scale initiatives utilising domestically developed pressurised fluidised bed gasification technology for chemical production.

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He further said that the work has been divided into four major packages. BHEL is executing the coal gasification and syngas purification packages, while Larsen & Toubro (L&T) is handling the ammonia synthesis and ammonium nitrate production packages.

"After purification, the gas will be converted into ammonia, and ammonia will be converted into nitric acid and ammonium nitrate. The ammonia and ammonium nitrate packages are under L&T's scope," Kumar said.

The project is being implemented in Odisha and has received single-window clearance from the high-level clearance authority of the state government.