Coal gassification to start soon

ONGC to invest Rs 5,000 crore in the joint venture project with GSPCL

Oil and Natural Gas Corporation chairman and managing director Subir Raha on Thursday said the proposed joint venture project with the Gujarat government-owned Gujarat State Petroleum Corporation (GSPCL) for gassification of huge reserves of coal is on track and will become operational soon.

Raha said while the project is at present in the stage of getting approvals from the state government as well as different departments of the Centre, both, the central and the state governments are "extremely supportive in this regard".

With an initial investment of Rs 500 crore towards a pilot project, ONGC might invest up to Rs 5,000 crore over the next few years on the gassification process.

"We have pioneered the gassification work in the country and even today, we held meetings with state government officials in this regard. We are moving forward with the project and should hopefully begin operations within the next few months," Raha said.

He said a number of licences and permissions are being secured from the petroleum ministry, coal ministry and various departments of the state government.

"The project is on track and is moving forward quickly," Raha said.

In January this year, ONGC had put forward a proposal to the state government for setting up a joint venture with GSPCL for initiating a unique coal gassification project in the state.

Chief minister Narendra Modi, who had a long interaction with the chairman and managing director of ONGC at the state capital, Gandhinagar, agreed in principle with the proposal moved by ONGC and shortly a special-purpose-vehicle (SPV) will be created with participation of GSPCL and ONGC.

The project may attract Rs 5,000 crore of investments over the next four years only by ONGC apart from the investment by the state government through GSPCL, said state government officials.

The project will be mainly concentrated on a vast area between Tharad and Patan in north Gujarat, close to the India-Pakistan international border. "There is a huge coal reserve in the stretch between Tharad of Banaskantha district and Patan town in Patan district of Gujarat. But because it is lying very deep, it could not be mined out. ONGC has come up with the idea of taking out the coal reserve by gassification. ONGC, with GSPCL, the key player in the state's oil and gas sector, will gassify the coal and then take it out. This will help mine the reserve at a lesser expense," said officials.