Coal news and updates

CIL calls private firms to bid for UCG projects

Coal India has invited private companies to develop two underground coal gasification (UCG) projects and commercially produce gas from the blocks.

UCG is applied on coal seams that are otherwise unprofitable or technically complicated to extract by traditional mining methods. The process involves injection of a mixture of compounds to the coal seam to produce gas that is then harnessed to turn turbines or for the production of chemicals.

Coal India has recently invited tenders from companies with experienced in UCG technology for developing the blocks which are owned by subsidiaries Western Coalfields and Central Coalfields.

It is looking to start with the Thesgora C block of Western Coalfields and the Kaitha Block of Central Coalfields. The contract will be for 25 years - five years for a pilot project and market survey and the rest for commercial operation. The developer will be required to submit a contract performance guarantee of Rs 25 crore and will be required to have previous experience of successfully implementing UCG projects from concept to commissioning.

Coal India has included a condition which requires the bidder to have a net worth of at least Rs 200 crore on an average for the past three financial years.

Nevertheless, the company hopes to complete the tendering process and award the contract within the next three months.

Source: The Economic Times