New Delhi: The Board of Directors of Bharat Petroleum Corporation Limited (BPCL) has approved the formation of a joint venture company with Coal India Limited (CIL) for setting up a coal gasification project at Western Coalfields in Maharashtra, subject to receipt of requisite regulatory approvals.
BPCL informed the stock exchanges that the approval was granted at the Board meeting held on December 18. The development is in continuation of the company’s earlier intimation dated December 2, 2024, regarding the proposed collaboration with Coal India .
As per the disclosure, the proposed joint venture will be a domestic entity, with Coal India holding a 51 percent stake, while BPCL will own the remaining 49 percent. The joint venture will be responsible for constructing, operating and maintaining the coal gasification project at Western Coalfields, Maharashtra.
BPCL said that key commercial details, including the total project cost, investment by the JV partners, issue price and class of shares, as well as the authorised share capital of the proposed JV company, will be finalised after completion of the project feasibility study and preparation of the Detailed Project Report (DPR). These details will be disclosed once the definitive agreements are executed and the Final Investment Decision is taken by the Board.
The company clarified that the proposed transaction does not fall under related party transactions and that the promoter, promoter group or group companies do not have any interest in the entity being formed. Details regarding board representation and other significant terms and conditions of the joint venture will also be decided at a later stage and incorporated in the definitive agreement.
Highlighting the strategic rationale for the collaboration, BPCL said the joint venture aims to leverage Coal India’s strength in domestic coal production along with BPCL’s expertise in refining and gas marketing. The proposed coal gasification project is expected to produce synthetic natural gas (SNG), which will act as an indigenous alternative to imported natural gas. The initiative is expected to promote clean coal technologies, enhance India’s energy security, reduce import dependence and support sustainable industrial growth in the country .
BPCL further stated that consideration for subscription to the share capital of the joint venture will be finalised at the time of signing the definitive agreement or when the Board takes the Final Investment Decision post completion of the Detailed Feasibility Study, whichever is later.
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