CIL floats global tender for setting up coal-to-methanol plant in Bengal

• The project envisaged to be set up through a surface coal gasification route will be based on the Build-Own-Operate (BOO) model

• The proposed coal-to-methanol plant would be set up at CIL-owned Dankuni Coal Complex (DCC) in West Bengal

New Delhi: State-run Coal India Ltd (CIL) said on Monday that it has floated a global tender for setting up the country's first coal-to-methanol plant in West Bengal at an investment of Rs 6,000 crore. The company is in dialogue with Indian Oil Corporation and other government-owned oil companies for long-term tie up for marketing of the methanol, it said in an official statement. The project envisaged to be set up through a surface coal gasification route will be based on the Build-Own-Operate (BOO) model. Through the tender CIL proposes to select the BOO operator for the life span of the plant, which is expected to be 25 years.

"This is a part of implementing the Methanol Economy programme of the government aimed at reducing the country's oil import bill", said a senior executive of the company.

Coal-to-methanol plant to come up at Dankuni coal complex in Bengal

The proposed coal-to-methanol plant would be set up at CIL-owned Dankuni Coal Complex (DCC) in West Bengal, currently run by its subsidiary South Eastern Coalfields Ltd. The capital outlay of the entire plant would be borne by the BOO operator, which would own and lease the plant, apart from designing, building, maintaining, producing and storing the product.

CIL would allocate the land, power, water to the operator for the proposed plant which targets 6.76 lakh tonnes of methanol per annum to be used for blending with petrol up to 15%. The plant is expected to cater to methanol requirement of four eastern states of the country – West Bengal, Odisha, Jharkhand and Bihar.

CIL would supply low-ash coal of Ranigunj coalfields for the production of 2,050 metric tonnes of methanol per day. CIL would meet around 1.5 million tonnes of coal requirement annually.

'Move aimed at reducing dependence on imported crude'

The executive said CIL has aligned itself with the national objective of reducing dependence on imported crude oil and the plan to set up the plant is a step in that direction. "It would also reposition coal as chemical feedstock from that of a conventional energy product resulting in considerable decrease of carbon foot print". India is signatory to COP 21, Paris Climate Change Conference.

Also read: India needs an energy policy that integrates RE and coal: Coal Secretary

The prospective bidders should have prior experience in building coal-to-liquid, coal gasification, coal-to-chemical, fertiliser and methanol plants. The plant is expected to be completed in 36 months, while the actual commissioning of the plant is envisaged to be in 41 months. The last date for the submission of bids is December 17, 2020.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated)