According to NLC India's CMD, Prasanna Kumar Motupalli, industrial conglomerate Larsen & Toubro and the UAE's energy service firm Petrofac have expressed interest in the development of NLC India's lignite-to-methanol plant in Neyveli, Tamil Nadu, worth Rs 44 billion. Motupalli stated that four companies were interested in the project and were currently in the process of submitting their bids. He further mentioned that the public sector company expected to finalise and award the project by the end of the following month.
Last year in October, Engineers India (EIL), the project management consultant for the proposed development, initiated a global tender for the project. The plant is anticipated to have an annual production capacity of approximately 400,000 tonne. Motupalli affirmed that NLC currently held the leading position in lignite-to-methanol or coal-to-methanol projects. He expressed their active pursuit of awarding the project, noting that the tendering process had already taken place, technical tie-ups were established, and preparations had begun at the Neyveli site. He expected the project to be awarded by the end of July, after which activities would commence promptly.
Motupalli added that four parties had already shown interest in the project and were actively progressing with their quotations. Petrofac from the UAE and L&T were among the interested parties, along with two others. The project would be executed through an engineering, procurement, and construction (EPC) contract, where NLC would provide the technology while the selected party would supply and install the system. The commissioning of the project was scheduled for 2027. L&T had been involved in gasification projects since 2004, having successfully completed 11 projects in the field. Petrofac, on the other hand, recently partnered with OCI Global, a global player in ammonia, fertilizers, and methanol, to deliver gasification-based green methanol projects.
NLC's lignite-to-methanol project, which is part of its diversification plan, aligns with the government's coal gasification strategy to meet ambitious net-zero targets. The company, previously known as Neyveli Lignite Corporation of India, has primarily focused on lignite mining and establishing lignite-based power plants. Recently, it established a wholly-owned subsidiary called NLC India Renewables to oversee its renewable energy ventures. The government introduced the National Coal Gasification Plan in November 2021, setting a target to gasify 100 million tonnes of coal by 2030. However, the plan is still gaining momentum, and the government is considering additional incentives for companies engaging in coal gasification, including GST reimbursement for coal procurement.
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