Coal India and Hindustan Urvarak & Rasayan Limited have signed a non-binding MoU to explore coal gasification-based urea production at Sindri, Jharkhand.
Coal India Limited (CIL) and Hindustan Urvarak & Rasayan Limited (HURL) have signed a non-binding memorandum of understanding (MoU) to explore coal gasification-based urea production at Sindri in Jharkhand.
The two companies executed the MoU on Tuesday, CIL said in a filing to the stock exchanges. It was signed “for exploring the development of a Coal Gasification based Urea Production at Sindri, Jharkhand,” the filing said.
The first work under the MoU will test whether the project is viable. “Under this Non-Binding MoU, initially the focus shall be to assess the technical, commercial, and implementation modalities of the project and to facilitate preparation of a Preliminary Feasibility Report (‘PFR’) for evaluating project viability,” CIL said.
Coal India and HURL to Assess Project Viability
The initial phase will focus on assessing the technical and commercial feasibility of the proposed project. The companies will also examine implementation modalities.
The assessment will support preparation of a Preliminary Feasibility Report (PFR). The report will help determine the project’s viability.
Coal India is a Promoter of HURL
HURL is a joint venture of Coal India, NTPC Limited and Indian Oil Corporation Limited (IOCL). The three companies together hold 89 percent of HURL’s equity in equal parts.
Fertilizer Corporation of India Limited (FCIL) and Hindustan Fertilizer Corporation Limited (HFCL) hold the remaining 11 percent, according to HURL’s website.
HURL operates natural gas-based urea plants at Gorakhpur, Barauni and Sindri. Each plant has a designed production capacity of 1.27 million tonnes per annum (MTPA) of neem-coated urea.
Coal India Expands Coal Gasification Portfolio
Coal India is also a promoter of Talcher Fertilizers Limited (TFL). TFL is developing a coal gasification-based urea plant at Talcher in Odisha.
GAIL (India) Limited, Rashtriya Chemicals and Fertilizers Limited (RCF) and FCIL are the other partners in TFL.
The Talcher plant has a designed capacity of 1.27 MTPA of urea. CARE Ratings said in an April 2026 rating note that the project’s cost had increased to Rs 19,062 crore from the originally approved Rs 13,277 crore.
The rating note also recorded cumulative delays of about 51 months. The commissioning timeline has consequently moved from June 2024 to December 31, 2027.
Coal India Advances Other Gasification Projects
Coal India’s largest gasification commitment outside fertiliser is at Lakhanpur in Odisha’s Jharsuguda district.
On June 20 this year, President Droupadi Murmu laid the foundation stone for a coal-to-ammonium nitrate plant. Prime Minister Narendra Modi joined the event remotely.
The plant is being developed by Bharat Coal Gasification & Chemicals Limited (BCGCL). Coal India holds 51 percent in BCGCL, while Bharat Heavy Electricals Limited (BHEL) holds 49 percent.
The plant is designed to produce about 0.66 MTPA of technical-grade ammonium nitrate. The Coal Ministry has estimated the investment at more than Rs 25,000 crore. Commissioning is targeted by September 2029.
Coal will be supplied by the Ib Valley washery of Coal India’s subsidiary Mahanadi Coalfields Limited (MCL). The facility will supply both washed coal and washery rejects.
Coal India is also pursuing two projects to convert coal into synthetic natural gas (SNG).
In West Bengal, Coal Gas India Limited plans to establish an SNG plant at Sonepur Bazari in the command area of Eastern Coalfields Limited (ECL). The company was incorporated in March 2025.
Coal India holds 51 percent in Coal Gas India Limited, while GAIL holds the remaining 49 percent.
A second SNG plant is planned in the Western Coalfields Limited (WCL) area of Maharashtra. For this project, the board of Bharat Petroleum Corporation Limited (BPCL) approved a joint venture with Coal India on December 18, 2025.
Coal India will hold 51 percent in the joint venture and BPCL will hold 49 percent.
When the government awarded incentives in December 2024, each SNG project was listed with a capacity of 1.83 million standard cubic metres per day (MMSCMD).
Coal India Projects Support 100 MT Gasification Target
These projects form part of the Coal Ministry’s National Coal Gasification Mission.
“National Coal Gasification Mission has set the ambitious target of achieving 100 Million Tonnes (MT) of coal gasification capacity by 2030,” Minister of State for Coal and Mines Satish Chandra Dubey said in a written reply to the Rajya Sabha in July.
Against this target, about 22.6 MTPA of capacity was operational or under implementation, he said.
Jindal Steel Limited’s gasification capacity of about 8 MTPA is already operational. TFL’s roughly 2.6 MTPA capacity remains under implementation.
Around 12 MTPA of capacity across eight projects backed by the government’s Rs 8,500 crore incentive scheme is also under implementation.
The scheme was approved on January 24, 2024. It provides incentives of 15 percent of capital expenditure, subject to specified ceilings.
In December 2024, the government issued Letters of Award worth Rs 1,350 crore each to three projects under the scheme. These included BCGCL’s Lakhanpur plant, the CIL-GAIL SNG project and Coal India’s Maharashtra SNG project.
On May 13, the government approved another tranche of Rs 37,500 crore to promote surface coal and lignite gasification.
The scheme provides support of up to 20 percent of the eligible plant and machinery cost. It is expected to utilise about 75 MTPA of coal.
Urea is among the products covered under the scheme. The support is capped at Rs 9,000 crore per product category. However, the cap does not apply to urea or SNG, according to a Coal Ministry presentation on the scheme.
Source: PSU Watch
