Bhubaneswar: The Rs 25,016-crore coal gasification-based ammonium nitrate project at Lakhanpur in Odisha’s Jharsuguda district is progressing as per schedule and is expected to be commissioned by March 2030, Union Minister of State for Coal and Mines Satish Chandra Dubey informed the Lok Sabha on Wednesday.
He also said the proposed Stage-II expansion of the IB Thermal Power Station at Banharpalli is currently under the bidding process.
In a written reply to a question by Bargarh MP Pradeep Purohit, the minister said the foundation stone for both the coal gasification project and the 2×660 MW Stage-II expansion of the IB Thermal Power Station was jointly laid by the President and the Prime Minister on June 20, 2026.
Dubey said the coal gasification project is being implemented by Bharat Coal Gasification and Chemicals Limited (BCGCL), a joint venture between Coal India Limited (CIL) and Bharat Heavy Electricals Limited (BHEL), while the thermal power expansion project is being executed by the Odisha Power Generation Corporation Limited (OPGC).
The minister informed the House that the coal gasification project has secured all key statutory approvals, including environmental clearance and Consent to Establish from the competent authorities. Major Engineering, Procurement and Construction (EPC) contracts have already been awarded, and site development work is in progress.
The project will establish a 0.66 million metric tonnes per annum (MMTPA) coal-to-ammonium nitrate plant using BHEL’s indigenous Pressurised Fluidised Bed Gasification (PFBG) technology. Projects and Development India Limited (PDIL) has been appointed as the Project Management Consultant, while BHEL and Larsen & Toubro (L&T) have bagged the major EPC packages.
Describing the project as a major milestone in India’s clean coal utilisation efforts, the minister said it would promote indigenous coal gasification technology and significantly enhance domestic production of ammonium nitrate, an essential industrial chemical widely used in the mining and infrastructure sectors.
On the proposed Stage-II expansion of the IB Thermal Power Station, Dubey said the project’s cost, execution timeline and contractor are yet to be finalised as the bidding process is still underway.
The minister further informed Parliament that the coal gasification project is expected to generate around 2,000 direct and indirect employment opportunities. Skilled, semi-skilled and unskilled workers will be engaged according to project requirements, with preference being given to eligible local youth in line with the government’s policies.
The twin projects are expected to provide a significant boost to industrialisation in western Odisha, strengthen the state’s power infrastructure and create employment opportunities in the mineral-rich Jharsuguda region.
Once operational, the coal gasification plant is also expected to reduce dependence on imported ammonium nitrate and support the country’s goal of greater self-reliance in the chemicals and mining sectors.
