Bharat Coal Gasification and Chemicals Ltd (BCGCL) has started ground construction on its ₹25,000 crore coal gasification project in Odisha, marking the project’s move from planning and contracting into physical execution. The company has awarded work worth about ₹15,000 crore, according to its Managing Director Peeyush Kumar.
BCGCL is a joint venture between Coal India Ltd (CIL) and Bharat Heavy Electricals Ltd (BHEL). CIL holds a 51 per cent stake in the company, while BHEL owns the remaining 49 per cent. The project has been established to produce technical-grade ammonium nitrate using coal gasification and is expected to have an annual production capacity of approximately 0.66 million tonnes.
“Most of the tenders have been awarded and construction has started,” Kumar said during the 17th Edition of Gasification India 2026, organised by the Mission Energy Foundation. He said contracts valued at about ₹15,000 crore had already been placed, with ₹10,000 crore awarded to BHEL and ₹5,000 crore to Larsen & Toubro.
The project has been divided into four major packages. BHEL is responsible for the coal gasification and syngas purification packages. L&T is handling the ammonia synthesis and ammonium nitrate production packages. The process will convert coal into syngas, which will then be purified and converted into ammonia. The ammonia will subsequently be used to produce nitric acid and ammonium nitrate.
The project is one of India’s commercial-scale initiatives to use domestically developed pressurised fluidised bed gasification technology for chemical production. Its planned output of technical-grade ammonium nitrate is relevant to industrial and mining operations that use the chemical, although the company has not provided a commissioning date in the supplied statement.
The remaining portion of the project cost will cover soft costs, including interest, depreciation and land-related expenses, Kumar said. The company has not disclosed the value of the unawarded construction packages or a revised schedule for completing the project.
The construction begins as India pursues a broader target of establishing 100 million tonnes of coal gasification capacity by 2030 under the National Coal Gasification Mission. The mission aims to convert coal into chemicals and reduce the country’s dependence on imported products such as liquefied natural gas, urea, ammonia and methanol.
The Odisha project has received single-window clearance from the state government’s high-level clearance authority. Further implementation will depend on the completion of the remaining tenders and the execution of the four project packages. The company’s next stated milestone is continued construction under the contracts already awarded.
