It is a welcome landmark: Prime Minister Narendra Modi commencing work for the Talcher fertiliser plant in Odisha based on coal gasification.
It will be India’s first coal gasification plant to produce 1.27 million tonnes of neem-coated urea. A tight schedule of 36 months has been set for commencing production. Large public sector companies, Coal India Ltd (CIL), Fertilizer Corporation of India Ltd (FCIL), GAIL and Rashtraya Chemicals and Fertilizers (RCF) are jointly promoting this Rs 13,000 crore project.
As early as the late 1960s Fertilizer Corporation of India Ltd (FCI), conceived production of urea through coal gasification. With an abundance of coal, it was considered logical to adopt this route in preference to having imported petroleum products as a feedstock.
Ahead of the oil crisis…
Three large-sized plants were decided upon at Ramagundam (AP), Korba (MP) and Talcher (Odisha). There were high expectations of the new technology to produce urea in large quantities. Dr. Triguna Sen, the then Union Minister of Petroleum and Chemicals, laid the foundation stone for the plant at Ramagundam on 2 October 1970. IE released a special issue at the function. Capacity at this stage was 900 tpd of ammonia and 1500 tpd of urea. A total investment of around Rs. 71 crore was envisaged with coal price assumed at 38.66 per tonne. The technology was not widely used yet. The more natural, more elegant route of gasification of petroleum products and later natural gas as a feedstock was preferred.
India did have familiarity with gasification of lignite. The Germans provided such technology and successfully produced urea from lignite. Just think of it: not one, three coal-based large fertilizer plants decided upon well ahead of the oil crisis of 1973! Disappointingly, FCIL did not pursue with the project. The country continued to import fertilizers in large volumes through the subsequent decades. In recent years, big-ticket investments have been rare.
The government decided to step up investments by large Public Sector Units. Luckily, there are thousands of acres acquired at cheap prices five decades ago have come in handy. Though FCI turned sick, the vast land parcels still available by FCI has come in handy with it to invest as its share of equity. The other three promoters, GAIL, CIL and RCF, are large profit-making companies and have synergies and complementarities. The giant PSU, Indian Oil Corporation would also be involved by supplying pet-coke to be blended with the high ash Indian coal. The quick success of this technology would result in sizeable savings in the foreign exchange spent on petroleum products used as feedstock. GAIL mentions an estimated saving of Rs. 1620 crore in the import bill of Natural liquefied gas.
There are two possibilities in this development: the first is the large market for indigenous coal promising a reduction in the import bill on oil. The second fallout relates to the dispersed production of fertilizers. In the initial stages, these were port-based, located adjacent to refineries. With the switch to gas as a feedstock, fertilizer plants, fed by gas pipelines, were situated near consumption centres. With coal as feedstock, such plants will be at coal pitheads. Can we look for such plants originally envisaged at Ramagundam and Korba? Of course, a quick success of the Talcher plant can prove to be a game changer. It can help India emerge in a large production of fertilizers.
