New Era Cleantech embarks on India's first private sector coal gasification project: interview

New Era Cleantech, a private sector venture, has embarked on a project to establish India's first private sector coal gasification plant. With an investment of approximately $2.5bn over a decade, the project promises to transform the industrially backward region of Vidarbha in Maharashtra's Chandrapur district.

At the heart of the project lies a 5mn tonnes/year coal gasification plant, designed to produce syngas, a mixture of carbon monoxide and hydrogen.

By employing advanced coal gasification technology and implementing low-cost carbon capture techniques, New Era Clean Tech aims to decarbonise the industrial, power, fertiliser, and chemical sectors, paving the way for a cleaner and more sustainable future.

In June 2022, Gopi Latpate, along with partner Balasaheb Darade, embarked on the project of setting up New Era Cleantech. The project signed an MoU with the Maharashtra state government in January this year. They have received an allocation of around 1,600-acre land by Maharashtra Industrial Development Corporation (MIDC).

Darade, founder and managing director of New Era Cleantech, spoke with NGW about the project.

Q: What is the current status of the coal gasification project? Are approvals in place? What is the total investment expected to be?

A: At New Era Cleantech, we are in the process of establishing India's first dedicated 5mn tonnes/year coal gasification plant, a greenfield project with an estimated investment of $2.5bn. The plant is not intended for captive consumption.

This project encompasses various aspects of sustainable technology, including hydrogen production, carbon capture utilisation and storage (CCUS), and gasification. The company signed an MoU with the Maharashtra government during the World Economic Forum in Davos in January 2023. The project has received the "ultra mega project" status from the Maharashtra government, highlighting its significance in the region's industrial development.

The MIDC has allocated approximately 1,650 acres of land for this project. This sizeable land allocation is expected to create over thousands of direct and indirect job opportunities in the Vidarbha area, which is a notable positive impact for the local economy. We are currently in the final stages of receiving environmental clearance and National Environmental Engineering Research Institute, Nagpur is doing our environmental study and we have already applied and received the terms of reference.

Our efforts to ensure a stable coal supply for our project involve a comprehensive approach. This includes pursuing options such as coal linkage with Western Coalfield (WCL) and Coal India. We have submitted an expression of interest (EOI) for an upcoming coal linkage auction tailored for new gasification plants. Additionally, we are exploring commercial coal mining. 

Balasaheb Darade, founder and managing director of New Era Cleantech.

Q: What will be the syngas output in the first phase of the project and when is it expected to be commissioned? What kind of chemical feedstock will be produced?

A: The project's primary objective involves coal gasification to produce synthetic gas, also known as syngas. This syngas can be further processed to yield various valuable derivatives, including ammonia, hydrogen, and other products. This innovative approach can be referred to as a "Blue refinery" and is gaining attention as it maximises the utilisation of coal for the production of diverse chemicals and fuels.

The 5mn tonnes/year capacity project involves coal gasification as its core process. Starting in a very high temperature furnace, coal is transformed into syngas, which is then refined in a gas processing unit to remove impurities like CO2 and H2S. This processed syngas can be utilised to create intermediate products such as methanol, hydrogen, or ammonia, serving as versatile building blocks for various downstream chemical and petrochemical processes.

Methanol, for instance, can be further converted into products like MEG and acetic acid, while hydrogen and ammonia can be used in the production of nitric acid, ammonium nitrate, and more. In essence, coal gasification generates syngas, a foundational fuel for the subsequent refining processes and the production of a diverse range of chemical and petrochemical products. We expect the project to be operational in the next three and a half years.

Q: Who would be your potential customers? Are you in talks with any offtakers?

A: In a conventional refinery or similar petrochemical facilities, the process involves obtaining natural gas or crude oil and subjecting it to multiple processing steps for downstream chemical production. However, in the case of New Era Cleantech project, the crude feedstock is coal, which is the resource that India has in abundance.

The process commences with gas preparation and production, which is typically sourced from various other countries. The plant will produce hydrogen, which can be categorized as "blue hydrogen". The decision regarding the utilisation of this will involve supplying it to government entities or large public sector undertakings, selling it in the private market, or blending it into regional pipelines and the local ecosystem around the region where the project is coming up.

We will also explore setting up a methanol plant, an ammonia plant, or a green hydrogen plant, to further enhance the project's capabilities and diversify the portfolio. We will also explore collaboration with the new natural gas pipeline going through Nagpur.

Q: How can this project help decarbonise the industry?

A: In the coal gasification process, the carbon dioxide (CO2) is pure and capture-ready. This purity simplifies the carbon capture process compared to industries like steel, power, or sugar production, where CO2 emissions often contain impurities and are more challenging to capture.

This technology offers a low-hanging fruit for industries seeking to reduce emissions, as it simplifies the capture process and allows for easier utilisation of the pure CO2. The main unique selling proposition of gasification is its readiness for decarbonisation, making it a compelling technology to lead the decarbonisation efforts in India. This technology's ease of carbon capture and emission reduction can serve as a motivating example for other industry players to adopt cleaner and more sustainable practices in India, ultimately driving a more significant impact on reducing carbon emissions and combating climate change.

A substantial portion of our feasibility study is dedicated to addressing the CCUS aspect of the project. This approach not only reduces the environmental impact of the project but also presents opportunities to earn carbon credits, which can significantly enhance the project's economic viability. By integrating CCUS practices into the project, it becomes a much cleaner technology with minimal residual environmental impact. Our project is designed to be holistic, focusing on both the production of chemicals and the responsible management of emissions through CCUS.

Q: Tell us about the technology that is being used for this project.

A: We are evaluating three distinct gasification technologies: fixed-bed gasifiers, entrained-flow gasifiers, and fluidized-bed gasifiers. Before the final selection, we will conduct simulations and trial runs to ensure the best fit for high ash Indian coal. Furthermore, we are actively collaborating with both national and international companies in the CCUS space and are continually seeking additional technology players to strengthen our network and expertise in this critical area.

Our internal team, composed of globally recognised experts in gasification technology, along with our technology consultant, Dastur Energy, who is also our partner in preparing the Detailed Feasibility Report (DFR), is progressing well. We are in the final stages of selecting the appropriate technologies licensing agreements, and exploring various options.

Additionally, we have initiated discussions about operational guarantees, particularly in the context of supplying hydrogen through pipelines, which can be blended into existing infrastructure, as well as exploring potential partners for optional technology agreements related to the chemicals we intend to produce and distribute. These partnerships and considerations are integral to the successful development and operation of our project.