Cabinet nod for coal-to-ammonium nitrate project at MCL command area

Cabinet also approves equity investment by CIL for setting up of Coal-to-SNG Project at ECL area

Team News Riveting

New Delhi, January 24

The Cabinet Committee on Economic Affairs (CCEA) chaired by the  Prime Minister, Narendra Modi today approved proposal for equity investment by (i) CIL for setting up of Coal-to-SNG (Synthetic Natural Gas) Project at ECL command area through a JV of CIL & GAIL; and (ii) for setting up of Coal-to-Ammonium Nitrate Project at MCL command area through a JV of CIL & BHEL.

The CCEA has approved the proposal of equity investments by CIL as follows:

1. Equity Capital of Rs.1,997.08 crore (±25 per cent) by CIL considering a Debt-Equity Ratio of 70:30, and 51 per cent Equity Investment in JV Company with an estimated Project Capex of Rs.13,052.81 crore (accuracy of ±25 per cent) for the proposed Coal-to-Synthetic Natural Gas (SNG) at Sonepur Bazari Area of Eastern Coalfields Limited (ECL) in Burdwan district of West Bengal through JV of CIL and GAIL.
2. Equity Capital of Rs.1,802.56 crore (± 25 per cent) by CIL considering a Debt-Equity Ratio of 70:30, and 51 per cent Equity Investment in JV Company with an estimated Project Capex of Rs 11,782.05 crore (accuracy of ±25 per cent) for the proposed Coal-to-Ammonium Nitrate (AN) at Lakhanpur Area of Mahanadi Coalfields Limited (MCL) in Jharsuguda district of Odisha through JV of CIL and BHEL.
3. Approval for Equity Investment by CIL beyond 30 per cent of its Net-worth in the JV of CIL-GAIL as at point (a) above, and in JV of CIL-BHEL as at point (b) above.

Coal India Limited (CIL) will set up following two Coal Gasification Plants with a view to achieve the target of 100 MT coal gasification by the year 2030 and to fulfil India’s dual objectives of self-reliance and energy independence –

1. CIL has signed MOUs with GAIL for setting up of Coal-to-SNG Project at Sonepur Bazari Area of Eastern Coalfields Limited (ECL) in Burdwan district of West Bengal through JV of CIL and GAIL at an estimated project cost of Rs.13,052.81 crore (±25 per cent) considering a debt:equity ratio of up to 70:30. 
2. CIL has signed MOUs with BHEL for setting up of Coal-to-Ammonium Nitrate Project at Lakhanpur Area of Mahanadi Coalfields Limited (MCL) in Jharsuguda district of Odisha a JV of CIL & BHEL, at an estimated project cost of Rs11,782.05 crore (±25 per cent) considering a debt:equity ratio of up to 70:30.