RIL Proposes India’s First Integrated Underground Coal Gasification Complex in Andhra Pradesh

Reliance Industries Limited has proposed an investment of about ₹2.73 lakh crore over 30 years for India’s first integrated Underground Coal Gasification (UCG) complex in Eluru district, Andhra Pradesh. The project will use deep coal reserves in the Chintalapudi and Recherla coal blocks, which together contain an estimated 3,130.61 million tonnes of coal at depths of more than 600 metres.

Underground Coal Gasification

Underground Coal Gasification is an in-situ process that converts coal into synthesis gas, or syngas, without conventional mining. The method uses controlled injection of oxidants into deep coal seams to produce a combustible gas mixture that can be used as an industrial feedstock.

Project Phases and Investment Plan

The proposed project has three stages. The first stage is a pilot and exploration phase with a budget of up to ₹3,000 crore, scheduled from the third quarter of 2026 to the fourth quarter of 2027. The second stage is a development phase from 2028 to 2030 with an estimated outlay of ₹1,20,000 crore. The third stage is a production phase from 2030 with a budget of ₹1,50,000 crore.

Coal Blocks and Resource Base

The Chintalapudi and Recherla coal blocks were acquired by RIL through commercial e-auctions conducted by the Ministry of Coal in April 2026. The blocks are located in coastal Andhra Pradesh and contain deep-seated coal reserves that are not suitable for conventional extraction at depths beyond 600 metres.

Industrial Uses of Syngas

The syngas produced through UCG can be used to manufacture hydrogen, methanol, urea, ammonia, and synthetic fuels. These products are used in fertiliser production, chemical industries, and fuel processing.

Important Facts for Exams

• Underground Coal Gasification is different from surface coal mining because it converts coal into gas below the ground.
• Syngas is a mixture mainly containing carbon monoxide, hydrogen, carbon dioxide, and methane.
• The Ministry of Coal conducts commercial e-auctions for allocation of coal blocks in India.
• Eluru district is located in Andhra Pradesh and lies in the coastal region of the state.

Employment and Regional Linkages

RIL estimates that the project may create 3,000 to 5,000 direct jobs and 20,000 to 35,000 indirect and induced livelihoods. The project is linked to domestic production of energy and chemical inputs used in multiple industrial sectors.