NTPC Submits Two Proposals Under Central Coal Gasification Scheme

State-owned power major NTPC Limited has submitted two proposals to establish coal gasification projects aimed at producing urea, methanol, and dimethyl ether (DME). According to an official statement released by the Ministry of Coal on Tuesday, these applications were submitted under the second round of the government's financial incentive scheme.

The second round of the Scheme for Promotion of Surface Coal/Lignite Gasification Projects concluded with a total of two applications, both originating from NTPC Limited. The Ministry of Coal noted that the proposals focus on the domestic manufacturing of key industrial and agricultural inputs.

Of the two submitted projects, one proposal targets the production of urea, a vital commodity used extensively in the fertilizers sector. The second proposal focuses on the production of methanol and dimethyl ether, which find significant utility across the chemical and fuel industries. However, the ministry's release did not disclose the financial investment amounts, proposed operational locations, or specific production capacities associated with NTPC's two projects.

Coal gasification is an industrial process that converts coal into a synthetic gas mixture. This gas can subsequently be utilized to manufacture various chemicals, fertilizers, and alternative fuels, thereby offering an alternative method for utilizing indigenous coal resources.

The Union Cabinet originally approved the Rs 37,500 crore scheme on May 13, 2026, to encourage surface coal and lignite gasification projects nationwide. The initiative forms a core component of the government's broader strategy to expand domestic coal gasification capacity and support local production of essential industrial products. Through these measures, the central government aims to contribute toward the national target of achieving 100 million tonnes of coal gasification capacity by the year 2030.

Following the conclusion of the second round, the Ministry of Coal announced that the third round of applications under the scheme will open on November 10. The deadline for eligible companies to submit their project proposals for this upcoming round has been set for January 11, 2027. Through these successive application windows, the ministry intends to encourage wider industry participation, attract industrial investments, and accelerate the commercial adoption of coal gasification technologies in the country.

"The submission of proposals by a major public sector undertaking like NTPC reflects the industrial transition toward alternative resource utilization in India. With the Ministry of Coal opening subsequent application rounds under the Rs 37,500-crore scheme, this initiative presents a structured opportunity for heavy industries and infrastructure players to engage in domestic chemical and fertilizer production. Achieving the national target of 100 million tonnes of gasification capacity by 2030 will rely heavily on sustained long-term capital investments and technological scaling by both public and private sector enterprises." — Dr. Shishir Gupta, Founder & CEO, StartupLanes