India’s First Commercial-Scale Coal-to-Ammonium Nitrate Project

In a significant step towards strengthening energy security and industrial self-reliance, the Prime Minister laid the foundation stone of India’s first commercial-scale coal-to-ammonium nitrate project at Lakhanpur in Jharsuguda district, Odisha on 20 June 2026. The project marks a major milestone in India’s coal gasification-based industrial development strategy and Aatmanirbhar Bharat vision.

About the India’s First Commercial-Scale Coal-to-Ammonium Nitrate Project 

The project is India’s first large-scale facility that will convert coal into ammonium nitrate using coal gasification technology. It represents a shift from traditional coal usage to clean and efficient coal-based chemical production.

• Location: Lakhanpur, Jharsuguda district, Odisha
• Investment: ₹25,016 crore
• Capacity: It will have a production capacity of 2,000 tonnes of ammonium nitrate per day. 
• The project will be set up on around 350 acres of land under the possession of Mahanadi Coalfields Limited.

The project has already received necessary clearances, and groundwork is expected to begin after the foundation ceremony.

Implementing Agency and Institutional Framework

• The project is being implemented through a public sector joint venture model.
• Bharat Coal Gasification and Chemicals Limited is the implementing company. 
• It is a joint venture between Bharat Heavy Electricals Limited and Coal India Limited.
• The project will use indigenous coal gasification technology developed by Bharat Heavy Electricals Limited, highlighting India’s growing capability in advanced industrial technologies.
• The Ministry of Coal is supporting the project through its incentive framework and policy facilitation.

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About Coal Gasification

Coal gasification is a process in which coal is converted into synthesis gas, also known as syngas. This gas can be used as a raw material to produce a wide range of chemicals and fuels.

Through this process, coal can be converted into products such as ammonium nitrate, methanol, urea, synthetic natural gas, and other chemical feedstocks.

This technology is important because it enables higher value addition from domestic coal, reduces dependence on imported natural gas and chemicals, and supports the development of downstream chemical industries.

Strategic Importance for India

India is endowed with one of the world’s largest coal reserves, estimated at over 400 billion tonnes, and is also among the largest producers and consumers of coal globally.

At present, India imports chemical and intermediate products worth approximately ₹2.7 lakh crore annually. Coal gasification offers a major opportunity to reduce this import dependence.

• The Lakhanpur project is therefore significant because it promotes domestic production of critical chemicals, strengthens industrial self-reliance, and improves energy security.
• It also supports the broader goal of making India a manufacturing hub by developing value chains based on domestic natural resources.