Reliance, IndianOil, Sail in race for CTL blocks
Kolkata   24-Jul-2008
Reliance Industries, Reliance Infrastructure, Reliance Power, Tata-Sasol, Essar Oil, Jindal Steel fr Power, Adani Power, Gail, IndianOil and Sail are among the 21 corporate biggies that intend to acquire coat blocks offered by the Centre for setting up coal-to-liquid (CTL) projects, Currently, three coal blocks are on offer and corporates which manage to acquire them will have to invest $6-8 billion {Rs 24,000 crore to Rs 32,000 crore) in each block for a 3.5 million tonne oil and oil products project. Total investments in three projects, therefore, will be anything between Rs 72,000 crore and Rs 96,000 crore. Coal to oil facilities consume coal as raw material, which is then convened into oil including petrol and diesel. Confirming the development, a senior official of coal ministry told ET. "The ministry has invited applications from interested parties with a minimum net-worth of Rs 4,000 crore each, It intends to allocate three coal blocks for CTL projects arid 21 companies are in the race. The blocks identified are at Talcher in Orissa and the last date for submission of/ application is July 21." Additionally, an inter-ministerial group (IMG) on CTL, with members from the Planning Commission, coal ministry as well as departments of expenditure, science and technology and the petroleum ministry, has been formed that will oversee the block allocation process. The ministry of coal will provide necessary secretarial assistance to the IMG. These companies will have to provide details of the technology proposed for CTL operations and details of the technology for coal gassification and coal liquefaction. They have to submit the broad perspective of the proposed projects like proposed capacity, coal requirement, location, finances as well as the proposed date of producing oil. "Since the technology for coal to liquid may not be indigenously available, the applicant company has to provide details of collaborations or tieup with proven technology providers," said sources. "The IMG will now meet and decide on the next course of action. However, each of these interested corporates will now be asked to present theft case to IMG, following which, selection of corporates for allocation of blocks will be made,' a senior ministry official close to the development said. The recommendations of the IMG will be placed before the government for final decision. A CTL plant converts coal into oil that can act as substitute for petrol and diesel. With crude prices now hovering around $ 127 a barrel CTL projects are important as oil produced through the process will be cheaper. The coal ministry has decided to offer blocks with reserves of 1-1.5 billion tonne of E/F grade. The Central Mine Planning & Design Institute (CMPDIL) is in the process of identifying more blocks for CTL projects. The blocks will allow mining of at least 28-31 million tonne of run-of-mine coal per annum for 30 years.