Jindal Steel and Power (JSPL), mulling a Rs 48,000-crore coal-to-liquid (CTL) project in Orissa, hopes to earn around Rs 16,000-crore revenues per annum from the project initially, a top official said today.
The Naveen Jindal-promoted firm is likely to sign an MoU with the Orissa Government in November for setting up the CTL plant in Angul district, where it has a steel unit with the production capacity of 6-million tonnes per annum, he said.
"The company would earn revenues of Rs 16,000 crore per annum from the CTL plant. The MoU is likely next month after which the company would go for land acquisition. The plan is to acquire 5,000 acres of land near Talcher in Angul," JSPL Senior Deputy General Manager Bibhu Prasad Mishra told PTI here.
JSPL's wholly-owned subsidiary, Jindal Synfuels, will be executing the project, he said, adding it would take 5-6 years to complete.
The project, which involves extraction of fossil oil from coal, would be the first such venture in the country that will produce about 80,000 barrels of oil per day, Mishra said.
CTL, a process of coal liquefaction that allows coal to be utilised as an alternative to oil, would help in cutting down on the import of crude oil, thus saving forex, and is a step towards India's much needed energy security.
The fuel is cheaper than crude oil and is of a better quality than the Euro 5 grade.
"Interest in constructing CTL plants tends to increase when the oil price is high and countries are concerned about the cost of their oil imports," Mishra said.
The Orissa Government has already allotted 1,500 million tonnes of coal blocks to JSPL. Of this, the company would be using around 30-35 million tonnes per annum of coal in its CTL plant, he said.
On the fuel's price, Mishra said the prices would be market-driven. As the fuel would be primarily for domestic consumption and mainly automotive, it would have no connection with the international prices.
On other benefits of CTL fuel, Mishra said the coal liquids can be used for transport, cooking, stationary power generation and in the chemicals industry. Besides, it would produce some down-stream products like naphtha and ammonia.
The Tata Group, along with South Africa's Sasol, had earlier announced setting up a similar CTL plant in Orissa.
Meanwhile, the state's single window nodal agency, IPICOL (Industrial Promotion & Investment Corporation of Orissa), said the MoU would be signed next month.
"The MoU is in a very advanced stage. There are some formalities to be done and the government may ink a deal with JSPL next month. The Tatas have also shown interest for a similar project in Dhenkanal and we are looking into it. The projects, once commissioned, will help shape the state's economy," IPICOl General Manager and Head (Outreach and Promotion) B N Palai said.
