New hurdle for CTL projects

It is two steps forward and one back for Indian coal-to-liquid (CTL) projects. Just a few months back an interministerial group had cleared an $8bn project proposed by the Tatas and Sasol. And Reliance Industries was also in talks with Coal India for a project.

But the coal ministry is now having second thoughts about CTL and is reportedly not keen on allocating coal blocks to private companies.

“We should not attach too much priority to these projects since we first need to extract enough coal to meet national demands. Only after than can we consider projects like CTL,” Santosh Bagrodia, the minister of state for coal, is reported to have stated.

The Tatas had sought access to 30m tonnes/year of coal for their CTL project.

One view in government circles is that India’s coal resources should be reserved for the power sector rather than used for new technologies such as CTL. Additionally, all the coal that is currently produced is already allocated.

It is time for CTL project proponenets to brush up their lobbying skills.

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