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Coal India’s first ever CBM extraction project gets off the blocks

Coal India Limited (CIL), in a first, has issued Letter of Acceptance to a CBM developer this month

Coal India’s first ever CBM extraction project gets off the blocks
Coal India’s first ever CBM extraction project gets off the blocks
  • The bid for Jharia CBM Block-I of Bharat Coking Coal Limited (BCCL), the Jharkhand-based subsidiary of CIL, was won by the CBM developer through a global bidding process
  • The project is to come up at a tentative capital of Rs 1,880 crore as per project feasibility report

New Delhi: Stepping into a new era of coal bed methane (CBM) extraction within its own leasehold area, Coal India Limited (CIL), in a first, has issued Letter of Acceptance to a CBM developer this month. This is for the extraction of CBM, the unconventional form of natural gas found in coal seams, said CIL in an official statement. The bid for Jharia CBM Block-I of Bharat Coking Coal Limited (BCCL), the Jharkhand-based subsidiary of CIL, was won by the CBM developer through a global bidding process. 

The project is to come up at a tentative capital of Rs 1,880 crore as per project feasibility report. While BCCL will be investing 20 percent of the capital, the rest would be put up by the CBM developer, said the statement.

CIL floats global bids for 2 more CBM projects

In yet another development, accelerating its intent on CBM extraction, CIL, in the second week of June, has floated global bids to look for developers for two more projects having a combined resource potential of 2.7 BCM. Raniganj CBM block under Eastern Coalfields Limited (ECL), West Bengal, has 2.2 BCM resource, while Sohagpur CBM Block under South Eastern Coalfields Limited (SECL) has 500 million cubic metre resource of methane. 

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Spread over an area of approximately 27 sq kms, Jharia CBM Block-I has CBM resource of over 26 Billion Cubic Metres (BCM). Average production capacity is pegged at 1.3 million metric standard cubic metres per day once the commercial operation kick starts. With the life span of this methane extraction project spread over 25 years, the development and production is expected to start from 2026.

CBM extraction part of CIL’s diversification portfolio

“This is a big step for Coal India. It is for the first time that the company has taken up CBM extraction on its own in its leasehold area. CBM extraction is a part of our diversification portfolio under clean coal initiatives” said a senior executive of CIL.

Methane has energy potential, and the captured gas can be put into use for many commercial uses. The commissioning of gas pipeline in eastern India under URJA Ganga project is in the works by GAIL. CBM produced may be used for city gas distribution or through pipeline for potential users. 

Central Mine Planning and Design Institute the consultancy arm of CIL will be the principal implementing agency for CIL’s CBM development in its leasehold areas. 

“Useful exploitation of CBM would not only lead to its efficient use as energy fuel but would also prevent its release into atmosphere during coal mining” added the executive. 

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