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Monday, January 14, 2008

RIL ready with $8bn for coal-based fuel project

New Delhi, Jan 13 The Mukesh Ambani-controlled Reliance Industries Limited is raring to go for yet another diversification. RIL has informed the government that it is ready with an $8-billion investment plant to set up a pit-head coal-to-liquid plant in the command area of the Mahanadi Coalfields Ltd (MCL). The project will have a capacity to generate 80,000 barrels of oil a day. It will be linked to captive coal blocks with a production capacity of 30 million tonne annually.

RIL has asked the ministry of coal to allocate three captive blocks in the Talcher coalfields of MCL with reserves of 1.6 billion tonne. The three open-cast blocks sought by RIL includes the Bankhui coal block with estimated reserves of 500 mt, the Sakhigopal B block (600 mt) and the Alaknanda block (500 mt).

RIL has informed the government that it has already signed confidentiality agreements with Houston-based KBR and Headwaters CTL (HCTL), also of the US, for using latest technology to set up such a plant in India. For producing coal in a most cost-effective manner, RIL said it would tie up with a reputed international coal mining company.

RIL further said, for a country like India, where coal is largely of inferior quality, the indirect method of coal liquefaction is considered appropriate. The technology for gasifying coal and then converting it to syn oil is available through Fischer Tropsch Sythesis.

RIL said in its letter, South African major Sasol's technology, which has been using the indirect method of coal liquefaction since the last 50 years to convert coal into syn gas and then to syn oil, is considered costly, but intense research and development efforts were under way for gaining more efficiencies. Incidentally, the Tatas have tied up with Sasol to put up a similar-capacity coal-to-liquid plant in India.

On HCTL as the technology provider, RIL said, the company had many Fischer Tropsch plants, including the first train of a coal-to-liquid plant at Shenhua in China, which is slated to start production in 2008.

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