NTPC Sole Applicant in Second Coal Gasification Round

The Ministry of Coal announced the conclusion of the second round of its Rs 37,500 crore Scheme for Promotion of Surface Coal/Lignite Gasification Projects on November 10, 2026. NTPC Limited was the sole applicant in this round, submitting two proposals for the production of urea, methanol, and dimethyl ether (DME). This represents a decline in private sector interest compared to the first round, which attracted seven applications from five different companies.

Approved by the Union Cabinet in May 2026, the scheme aims to reduce India's reliance on imports of liquefied natural gas, urea, ammonia, and methanol, which cost approximately Rs 2.77 lakh crore in FY25. The government intends to reach a national coal gasification capacity of 100 million tonnes by 2030, though some targets specify 75 million tonnes.

Industry experts attribute the lack of private participation to high capital expenditure, financing constraints, and logistical costs. In response, Dastur Energy proposed a government-supported partial credit guarantee mechanism to lower financing costs. To encourage broader industry investment, the ministry launched a third round of applications on November 11, 2026, with a submission deadline of January 11, 2027.