Oil India Ltd (OIL) has firmed up plans to set up a $2.5 billion coal liquefaction project in the North-East in collaboration with Headwaters CTL (HCTL) of the US.
The total requirement of coal for this project has been pegged at 120 million tonne during its life term of 30 years.
Company officials said a requirement of 3.5 to 4 million tonne per annum of coal has been worked out for the project for which OIL has already initiated talks with Coal India Ltd (CIL).
?A joint task forced of OIL and CIL is currently reviewing the availability and supply of 3.5 million tonnes of coal continuously for 30 years from Assam, Arunachal Pradesh and Meghalaya for commercial coal liquefaction plant in the North-East,? an official said.
Several countries have begun to use their coal reserves for energy extraction to meet their growing fuel needs and tap alternative sources amid a global rise in petrol prices. Coal gasification is a recognised and proven clean coal technology while liquefaction aims at converting coal to liquid fuels, for which commercially-proven technology is available.
A similar project has been proposed by the Tata?s and Indian Oil in collaboration with Sasol of the South Africa. South Africa has been successfully producing gasoline and fuel oil from coal for quite some time. The official recognition of coal gasification and liquefaction as end-uses is expected to lead to a further development of technologies by the public sector as well as private industries.
At a recent meeting with ministry officials, OIL officials revealed that the project will use the direct coal liquefaction technology of HCTL for commercialisation of this project. A letter of award has been issued recently to HCTL for carrying out a feasibility study. The study will be funded by the Oil Industry and Development Board (OIDB) and be completed in 16 months.
In order to promote alternative energy sources, the government has recently approved captive mining for gas production from coal – by processes known as gasification and liquefaction. This process enables the extraction of energy from coal seams, which cannot otherwise be mined.
Coal-rich China recently launched its largest coal-bed methane liquefaction project that would also help reduce greenhouse gas emissions.