Govt set to auction mines for coal-to-gas, CTL projects in financial year 2017-18

The government is set to auction coal blocks for private coal-to-gas, liquid and polychemical projects in 2017-2018, a top official said on Monday. "My priority is very clear... coal-to-gas, coal-to-liquid, coal-to-polychemical (CTL). That is something which Iwant should move... I think very soon, in about two months, weshould be coming out with some blocks to be offered to theprivate sector for these projects," Coal Secretary Susheel Kumar told PTI in an interview.     

The development takes on significance as domestic coal gas can help lower the country's import bill by USD 10 billion in five years and cut carbon emission. "So, Coal India will attempt all this from whatever coalmines they have. Second, fresh coal blocks would be auctioned to the private sector through competitive bidding forexploring coal to gas, liquid and polychemicals. We will auction the coal mine for these projects," the secretary said.     

The process of identification of blocks is under way, he said, adding that mines will not be out of the 204 cancelled blocks, but will be fresh ones under the MMDR Act. "There is a technical committee which is identifyingthese blocks. So, I have asked them to identify and comeback," he said.     

Asked to provide a timeline for the competitive bidding, the secretary said, "(It should be) this financial year because we may have to go to the Cabinet. So, let me first get those identified, then we will go to the Cabinet to seek mandate and do it."     

India's dependence on petroleum and natural gas can be reduced or done away with if the country manages to secure gas from coal.     

"Why we want to do this is very clear. Because it issomething which is unexplored for the country. It requiressome new technology. It requires new partners. So, those companies who would like to venture into this area should beassured of at least the coal block so that they can plan theirinvestment," Kumar explained.     

"We will have to take a mandate from the Cabinet that wewant to explore these areas which are non-traditional in thecoal sector. Normally, coal is consumed in the sense of burning it...

The root is whether it is going to be converted into something very useful... we have to explore that becausewe don't have enough of gas or oil, but we have coal," he said.     

Imports of 4-5 chemicals like urea, methanol, ammonia and ascetic acid are worth around USD 5.5 billion at present. If the country is able to gasify coal and use the samefor production of chemicals, including urea and methanol, it would lower the import bill manifold by 2030.