State-owned Coal India has announced the formation of a new subsidiary, Bharat Coal Gasification and Chemicals Ltd (BCGCL), to venture into the coal-to-chemicals business. Coal India (CIL) will hold a majority 51% stake in BCGCL, with the remaining 49% owned by Bharat Heavy Electricals Ltd (BHEL), according to a statement filed with the Bombay Stock Exchange (BSE).
This new development follows the signing of a joint venture agreement between CIL and BHEL, aimed at exploring opportunities in the coal-to-chemicals sector. The joint venture has received necessary approvals from NITI Aayog and the Department of Investment and Public Asset Management (DIPAM), paving the way for its establishment.
Bharat Coal Gasification and Chemicals Ltd has been established to focus on converting coal into chemicals, specifically to produce ammonia and nitric acid as intermediate products, and ammonium nitrate as the final product. This initiative marks a significant step in diversifying CIL's business operations beyond coal mining.
In a related development, Coal India had previously signed a Memorandum of Understanding (MoU) with GAIL (India) Limited for the development of a coal-to-synthetic natural gas (SNG) project. This project is set to be located in the Sonepur Bazari area of Eastern Coalfields Limited (ECL) in Burdwan district and has an estimated project cost of Rs 13,052 crore.
Coal India continues to dominate the domestic coal production landscape, accounting for over 80% of the country's total coal output. The incorporation of BCGCL and the partnership with BHEL and GAIL represent strategic moves by CIL to leverage its extensive coal reserves for the production of value-added chemical products, thereby expanding its business portfolio and contributing to India's industrial growth. These initiatives highlight Coal India's commitment to innovation and diversification in the energy and chemicals sectors, positioning the company to meet evolving market demands and contribute to the country's economic development.