Working hard to increase coal gasification: Coal & mines minister G Kishan Reddy

New Delhi: The government is working to support coal gasification to diversify conventional mining and promote cleaner use of the fuel, coal and mines minister G Kishan Reddy said on Thursday.

"The government is working hard to increase coal gasification, whether it's surface or underground, and will soon bring an action plan to diversify the coal sector," Reddy said at the launch of the 13th round of commercial coal mine auctions. "We will be speaking with state governments and stakeholders for this."

Coal gasification converts coal into a mixture of hydrogen, carbon monoxide and carbon dioxide by exposing it with oxygen, steam or air under controlled conditions. The process allows use of coal that cannot be tapped otherwise.


The minister said more than 40% of India's coal resources, around 370 billion tonnes, are deep-seated and cannot be mined through conventional methods.

Underground coal gasification needs a transformative approach, allowing the vast and untapped coal reserves to be converted directly into syngas underground.

The government had approved an outlay of ₹8,500 crore in 2024 for promoting coal/lignite gasification projects for both government PSUs as well as the private sector.

The government also offers a 50% rebate on the revenue share for coal used in gasification if at least 10% of the total coal production is used for gasification.

Reddy said reforms in the coal sector, such as open auction, have brought in transparency, which has increased coal production in the country, ensured the availability of coal for power, steel, cement and other sectors, and reduced coal imports.

"Coal shortage in the country has been largely eliminated, and coal imports compared to last year have declined by 9%," he said.

Fourteen mines are up for grabs in the 13th round of the commercial coal block auction.