Coal to Ammonium Nitrate Project Launched in Odisha | 02 Apr 2026

Why in News? 

Bharat Coal Gasification and Chemicals Limited (BCGCL) and Mahanadi Coalfields Limited (MCL) signed a land leasing agreement for the Coal to Ammonium Nitrate Project at Lakhanpur, Odisha. 

Key Points

• Project: The project envisages a coal to ammonium nitrate facility at Lakhanpur, Odisha with a capacity of 2,000 tonnes per day.  
  • It is India’s first coal gasification project to deploy indigenously developed gasification technology by Bharat Heavy Electricals Limited (BHEL). 
  • The Cabinet has approved a budget of ₹8,500 crore to advance coal gasification initiatives. 
• Venue: The leasing agreement was signed in New Delhi in the presence of G. Kishan Reddy, Union Minister of Coal and Mines.  
• Incentives: The Ministry of Coal has extended financial support of ₹1,350 crore under a dedicated financial incentive scheme to promote coal gasification. 
• Implementation: Major Lump Sum Turnkey (LSTK) packages have been awarded to BHEL and Larsen & Toubro for various phases of execution. 
• Investment: The land lease agreement reflects an estimated investment of around ₹25,000 crore.  
• Strategic Importance: The project is expected to reduce import dependence, conserve foreign exchange, and strengthen domestic industrial capabilities in energy and chemicals.