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Business News/ Industry / Energy/  ONGC abandons decade-long UCG project
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ONGC abandons decade-long UCG project

Processing of gas at surface shall be a challenge as syngas has many impurities and contamination, ONGC said

UCG is a technique used to convert deep-seated coal directly into gas.Premium
UCG is a technique used to convert deep-seated coal directly into gas.

MUMBAI : State-run Oil and Natural Gas Corporation Ltd (ONGC) has decided to abandon the underground coal gasification (UCG) project that it was carrying out over the past decade because of low calorific value of syngas, low gas price, and unavailability of business partners, the company said.

“Processing of gas at surface shall be a challenge as syngas has many impurities and contamination. Non-availability of business partners from coal/ chemical/power sectors for business ease during pilot/ commercialization along with the current gas price scenario are factors. The company is of the opinion that it is not prudent to venture into this business at this juncture," ONGC said in its annual report released on Monday.

UCG is a technique used to convert the coal seated deep within the earth, which is otherwise inaccessible, directly into gas. Holes are drilled from the surface till the coal bed, igniting the steam and then passing air/oxidising agent to obtain synthesis gas (syngas). This syngas, a mixture of carbon monoxide, hydrogen and methane, can be used to generate electricity or utilized as feedstock in manufacturing.

India has very large deposits of deep-seated coal and lignite, which are not amenable to coal extraction by conventional mining methods. There is an estimated reserve of 289.87 billion tonnes of non-coking coal and 46.02 billion tonnes of lignite in India, according to the 2021 annual report of the ministry of coal. ONGC had taken up the Vastan Mine block site of Gujarat Industries Power Company Ltd (GIPCL) in Naninaroli, Surat district, Gujarat, as a research and development pilot project to establish UCG technology in collaboration with National Mining Research Center-Skochinsky Institute of Mining (NMRC-SIM), Russia. UCG is the only feasible technology with the potential to convert coal resources to coal reserves.

ONGC had obtained the environmental clearance for the project from the ministry of environment and forests in January 2010 and the agreement to co-operating in research and development was extended up to 4 March 2020. The mining lease for the Vastan pilot project had been awarded to GIPCL. “However, all state public sector units of Gujarat, including MoU partner GIPCL, have backed out of the UCG project because of the low calorific value of the syngas," ONGC said.

ONGC, which had expected positive results, had identified several sites in association with Neyveli Lignite Corp. Ltd for studying their suitability for UCG. These include Tadkeshwar in Gujarat and Hodu-Sindhari and East Kurla in Rajasthan. One more site was jointly identified by ONGC and Gujrat Mineral Development Corporation (GDMC) in Bhavnagar district of Gujarat. The data of all the fields were analysed for evaluating the suitability of these sites for UCG and the sites were found suitable for UCG exploration.

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Published: 01 Sep 2021, 12:51 AM IST
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