Coal Ministry rejects ‘No Takers’ claim, says TFL, NTPC apply for gasification scheme
The Ministry of Coal rejected reports suggesting that the Scheme for Promotion of Surface Coal/Lignite Gasification Projects has found "no takers"
Talcher Fertilisers Limited (TFL) and NTPC Limited have already submitted applications under the scheme
The first application window remains open and is scheduled to close on September 7, with other prospective applicants at various stages of preparing proposals
TFL, a joint venture promoted by GAIL (India) Ltd, Coal India Ltd, RCF and FCIL, is developing a coal-based ammonia-urea gasification complex at its Talcher unit in Odisha, targeted for commissioning in FY 2027-28
Coal/Lignite Gasification and the National Coal Gasification Mission
Coal gasification converts coal or lignite into syngas (a mixture of carbon monoxide and hydrogen) through partial oxidation under controlled conditions, rather than direct combustion. Syngas can then be converted into higher-value products such as methanol, ammonia, urea and substitute natural gas (SNG), reducing India's reliance on imported fossil feedstock and fertiliser inputs.
Key Details
- National Coal Gasification Mission launched in 2021, with a target of 100 Million Tonnes Per Annum (MTPA) coal gasification capacity by 2030
- About 22.6 MTPA of gasification capacity is currently operational or under implementation
- An earlier coal gasification support scheme with an outlay of Rs 8,500 crore was approved in January 2024
- The current Scheme for Promotion of Surface Coal/Lignite Gasification Projects, approved by the Union Cabinet, carries a financial outlay of Rs 37,500 crore and is expected to utilise around 75 MTPA of coal/lignite
The TFL and NTPC applications are among the first responses to this Rs 37,500-crore scheme, directly testing whether students can identify the scheme's scale, objective, and its place within the broader 100-MTPA-by-2030 Mission target.
Talcher Fertilisers Ltd and Feedstock Diversification for Urea
TFL is a joint venture company promoted by GAIL (India) Ltd, Coal India Ltd, Rashtriya Chemicals & Fertilizers (RCF) and Fertilizer Corporation of India Ltd (FCIL), formed to revive the dormant FCIL fertiliser unit at Talcher, Odisha, using coal — rather than natural gas — as the feedstock for urea production via gasification technology.
Key Details
- Planned urea production capacity: approximately 1.26 Million Metric Tonnes Per Annum (MMTPA)
- It represents one of India's first attempts to produce urea from coal-based syngas instead of imported natural gas/LNG-based feedstock, which most existing urea plants use
- Commissioning is targeted for FY 2027-28
TFL's application under the scheme signals continued government backing for coal-to-urea gasification as a strategy to cut dependence on imported natural gas and reduce the fertiliser subsidy burden tied to global gas prices.
Import Substitution: Methanol, Ammonia and the Methanol Economy
India currently imports significant quantities of methanol, ammonia and urea, all of which can be produced domestically from syngas derived from India's abundant coal reserves. This aligns with the broader "Methanol Economy" push promoted by NITI Aayog, which advocates methanol as an alternative transport fuel and chemical feedstock.
Key Details
- Methanol and ammonia are both syngas-derivative products, making coal gasification capacity fungible across multiple import-substitution goals
- Domestic coal-based production reduces exposure to global price volatility in LNG and ammonia markets, which directly affects India's fertiliser subsidy outgo
The scheme's design — rewarding projects that convert coal into ammonia, urea, methanol or synthetic natural gas — is a direct policy lever aimed at reducing these import bills, with TFL's ammonia-urea complex as a working example.
- Scheme for Promotion of Surface Coal/Lignite Gasification Projects: financial outlay Rs 37,500 crore
- National Coal Gasification Mission target: 100 MTPA coal gasification capacity by 2030 (Mission launched 2021)
- Current operational/under-implementation gasification capacity: approximately 22.6 MTPA
- Earlier coal gasification support scheme (January 2024): outlay Rs 8,500 crore
- TFL planned urea capacity: approximately 1.26 MMTPA; commissioning targeted FY 2027-28
- TFL promoters: GAIL (India) Ltd, Coal India Ltd, RCF, FCIL
- Scheme's first application window closes September 7