Ministry Issues Letter Of Award For Coal Gasification Project

05 May 2026 CW Team

An LoA was awarded to Kartikay Vayunandana Private Limited to establish a coal-to-acetic-acid small-scale plant at Gadchiroli in Maharashtra. The project involves an investment of Rs 793 crore (Rs 7,930 mn) and is planned to produce acetic acid with an installed capacity of 75,900 tonne (t) per annum, representing a step towards downstream chemical manufacture from indigenous feedstock. The facility is positioned as a product-based demonstration that could inform wider adoption of gasification technologies.

The scheme continues to gain momentum, with seven projects under implementation from Round One and Requests for Proposals for Round Two issued under Category Two and Category Three to accelerate investment. Category Three provides support for demonstration and small-scale product plants, with financial assistance of up to Rs 100 crore (Rs 1,000 mn) per project or 15 per cent of the capital expenditure, whichever is lower. The provisions are intended to lower project risk and stimulate innovation in gasification routes and downstream processing.

The ministry indicated the project is expected to boost indigenous production of downstream chemicals, reduce import dependence and strengthen the drive for Atmanirbhar Bharat. Officials said the award reinforces the government commitment to building a more sustainable industrial ecosystem through cleaner and more efficient utilisation of coal resources. The programme is presented as part of a broader policy push to convert domestic coal reserves into higher value products.

The Ministry of Coal has issued a Letter of Award under Category III of Round Two of the Rs 8,500 crore Financial Incentive Scheme for Promotion of Coal and Lignite Gasification Projects, marking a major milestone in advancing the national coal gasification mission. The scheme, valued at Rs 8,500 crore (Rs 85,000 mn), seeks to encourage product-oriented gasification and demonstration projects to enable value added utilisation of domestic coal resources. An LoA was awarded to Kartikay Vayunandana Private Limited to establish a coal-to-acetic-acid small-scale plant at Gadchiroli in Maharashtra. The project involves an investment of Rs 793 crore (Rs 7,930 mn) and is planned to produce acetic acid with an installed capacity of 75,900 tonne (t) per annum, representing a step towards downstream chemical manufacture from indigenous feedstock. The facility is positioned as a product-based demonstration that could inform wider adoption of gasification technologies. The scheme continues to gain momentum, with seven projects under implementation from Round One and Requests for Proposals for Round Two issued under Category Two and Category Three to accelerate investment. Category Three provides support for demonstration and small-scale product plants, with financial assistance of up to Rs 100 crore (Rs 1,000 mn) per project or 15 per cent of the capital expenditure, whichever is lower. The provisions are intended to lower project risk and stimulate innovation in gasification routes and downstream processing. The ministry indicated the project is expected to boost indigenous production of downstream chemicals, reduce import dependence and strengthen the drive for Atmanirbhar Bharat. Officials said the award reinforces the government commitment to building a more sustainable industrial ecosystem through cleaner and more efficient utilisation of coal resources. The programme is presented as part of a broader policy push to convert domestic coal reserves into higher value products.

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