**Executive Summary**
On June 20, 2026, Prime Minister Narendra Modi will lay the foundation stone for India’s first commercial-scale coal-to-ammonium nitrate project in Lakhanpur, Odisha. This Rs 25,016 crore initiative, developed by Bharat Coal Gasification and Chemicals Limited (BCGCL), is a critical step toward energy security and import substitution. The project forms part of a broader national strategy to catalyze Rs 2.5 to 3 lakh crore in investments and create 50,000 jobs through coal gasification.
**Key Points / Main Content**
**Project Specifications and Development**
* **Location and Scale:** The project is situated on 350 acres in the Jharsuguda district of Odisha, representing a total investment of Rs 25,016 crore.
* **Production Capacity:** The facility is designed to produce 2,000 tonnes of ammonium nitrate per day.
* **Indigenous Technology:** The project will utilize coal gasification technology developed indigenously by Bharat Heavy Electricals Limited (BHEL).
* **Joint Venture:** The project is being executed by BCGCL, a joint venture between BHEL and Coal India Limited (CIL).
**Strategic National Objectives**
* **Import Reduction:** India aims to reduce its Rs 2.7 lakh crore annual expenditure on imported end-use and intermediate chemical products.
* **Energy Security:** By converting coal into synthesis gas (syngas), the nation intends to produce methanol, urea, and synthetic natural gas domestically.
* **Resource Utilization:** The initiative leverages India's status as the world's second-largest coal producer and its reserves of over 400 billion tonnes.
**Financial Incentives and Policy Support**
* **National Incentive Scheme:** The Government of India has approved a cumulative outlay of Rs 46,000 crore to promote surface coal and lignite gasification projects.
* **Direct Project Support:** The Ministry of Coal is providing Rs 1,350 crore in financial support specifically for the Lakhanpur project.
* **Land Use Policy:** New provisions allow the use of coal-bearing area land for these industrial projects to facilitate development.
**Impact Analysis**
**Bharat Coal Gasification and Chemicals Limited (BCGCL)**
**Impact**
As the primary developer and joint venture of BHEL and CIL, BCGCL is responsible for implementing the first commercial-scale model of this technology.
**Action Required**
Commence site work immediately following the foundation stone ceremony and manage the integration of BHEL’s indigenous technology.
**Mahanadi Coalfields Limited (MCL)**
**Impact**
The project utilizes 350 acres of land currently under MCL’s possession.
**Action Required**
Fulfil the terms of the land-leasing agreement signed in April to ensure the project site is ready for construction.
**Indian Chemical and Manufacturing Industries**
**Impact**
Downstream industries will benefit from a domestic supply of feedstocks such as methanol, ammonia, and ammonium nitrate, reducing dependence on international market fluctuations.
**Action Required**
Strategize for the integration of domestic chemical outputs into supply chains to support the "Aatmanirbhar Bharat" vision.
**Local Workforce in Coal-Bearing Regions**
**Impact**
The coal gasification initiative is expected to generate approximately 50,000 direct and indirect employment opportunities across 25 planned projects.
**Action Required**
N/A (The document notes the opportunity for employment but does not specify immediate actions for this group).
Key Entities Referenced
Surface Coal and Lignite Gasification Projects (Incentive Scheme): A central government initiative with a ₹46,000 crore outlay aimed at promoting coal gasification to reduce import dependence on chemical feedstocks.
Bharat Coal Gasification and Chemicals Limited (BCGCL): A joint venture between BHEL and Coal India Limited (CIL) established to develop India’s first commercial-scale coal-to-ammonium nitrate facility.
Ministry of Coal: The primary administrative body providing financial support and policy enabling for coal gasification projects and land-use clearances.
Lakhanpur, Jharsuguda, Odisha: The location of India’s first commercial-scale coal-to-ammonium nitrate project, marking a historic milestone in the country's energy strategy.
Ministry of Coal
Prime Minister to Lay Foundation Stone of India’s
First Commercial-Scale Coal-to-Ammonium
Nitrate Project in Odisha
प्रव तथ: 19 JUN 2026 12:50PM by PIB Delhi
In a major step towards strengthening India's energy security, promoting import substitution, and
accelerating industrial self-reliance, Prime Minister Shri Narendra Modi will lay the foundation
stone of a Rs 25,016 crore coal gasification project at Lakhanpur in Jharsuguda district, Odisha,
on June 20, 2026.
Coal gasification is emerging as a key pillar of India's strategy to strengthen energy security,
reduce dependence on imported critical feedstocks, promote value addition to domestic coal
resources and support the development of downstream industries. The process converts coal into
synthesis gas (syngas), which can be used to produce a wide range of value-added products such
as methanol, urea, ammonium nitrate, synthetic natural gas, and other chemical feedstocks. This
has the potential to drive industrial growth, reduce dependence on imported raw materials, and
strengthen the country's energy and economic security.
India is the world's second-largest producer and consumer of coal, with Coal India Limited being
the largest coal-producing company globally. India is endowed with the world's fifth-largest coal
reserves of over 400 billion tonnes. Leveraging these resources through coal gasification can
significantly transform the country's industrial landscape while reducing import dependence on
critical feedstocks and chemicals.
Recognizing the transformative potential of coal gasification, the Government of India has
approved incentive schemes with a cumulative outlay of up to Rs 46,000 crore to promote
Surface Coal and Lignite Gasification Projects across the country. The initiative aims to
accelerate the establishment of coal gasification projects across the country, encourage the use of
domestic coal for strategic industrial and chemical outputs, and reduce dependence on imports of
natural gas, methanol, ammonia, and other critical feedstocks.
India currently imports end-use and intermediate chemical products worth approximately Rs 2.7
lakh crore annually. Coal gasification offers a significant opportunity to reduce these imports,
generate substantial foreign exchange savings, strengthen domestic manufacturing capabilities
while supporting industrial growth and economic self-reliance.
The coal gasification promotion initiative is expected to catalyse investments of Rs 2.5 to 3 lakh
crore and create around 50,000 direct and indirect employment opportunities across 25 projects
in coal-bearing regions.
The Lakhanpur project marks a historic milestone as India's first commercial-scale coal-to-
ammonium nitrate facility. The project is being developed by Bharat Coal Gasification and
Chemicals Limited (BCGCL), a joint venture of Bharat Heavy Electricals Limited (BHEL) andCoal India Limited (CIL). It will produce 2,000 tonnes per day of ammonium nitrate using
indigenously developed coal gasification technology by BHEL.
A land-leasing agreement was signed in April between BCGCL and CIL’s subsidiary Mahanadi
Coalfields Limited (MCL). The project will come up on about 350 acres under MCL possession,
has received required clearances and work is expected to start after the foundation ceremony. The
Union Ministry of Coal has enabled the use of coal bearing area land for such projects and is
providing Rs 1,350 crore support under its incentive scheme.
The project will serve as a model for future coal gasification ventures and contribute significantly
to India's vision of becoming a self-reliant manufacturing and industrial powerhouse. The
foundation stone laying of the Lakhanpur project underscores the Government's commitment to
promoting clean coal technologies, maximizing value from domestic resources, and building a
resilient industrial ecosystem aligned with the vision of Aatmanirbhar Bharat.
***
Shuhaib T
(रलीज़ आईडी: 2275058) आगंतुक पटल : 1613
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