Reliance Industries Bets ₹2.73 Lakh Crore On Andhra Coal Gasification

Reliance Industries Limited (RIL) has proposed an investment of approximately ₹2.73 lakh crore over 30 years to develop India's first integrated Underground Coal Gasification (UCG) complex in the Eluru district of Andhra Pradesh, subject to commercial viability following exploration.

The complex will come up in the Chintalapudi and Recherla blocks in coastal Andhra Pradesh. RIL recently won the two coal blocks in an e-auction held by the coal ministry.

RIL did not respond to a request for comment.

At 11:06 AM, Reliance Industries shares were down by 0.02%, trading at ₹1,310.70.

Three-Phase Investment Plan

The proposed investment of Reliance Industries is structured across three phases:

• Exploration and pilot phase from Q3 2026 to Q4 2027: Up to ₹3,000 crore

• Development phase from 2028 to 2030: ₹1,20,000 crore

• Production phase from 2030 onwards: ₹1,50,000 crore

RIL will begin exploration activities in the current fiscal year. The later phases are contingent on exploration success.

The Coal Blocks

The Chintalapudi coal block covers around 3,000 acres and has an estimated 904.94 million tonnes of G-12 grade coal. The Recherla block spans 5,500 acres and is estimated to hold 2,225.67 million tonnes of G-13 grade coal.

Together, the two blocks have estimated coal reserves of 3,130.61 million tonnes. Officials said the coal deposits are located more than 600 metres below the surface.

What Underground Coal Gasification Does

Underground Coal Gasification is an in-situ process that converts deep-seated coal into synthesis gas without physically extracting it. India has approximately 360 billion tonnes of total coal reserves, with nearly 160 billion tonnes too deep for conventional mining. The technology converts otherwise stranded coal into energy, chemicals and revenue without the land disturbance, displacement or underground manpower risks associated with conventional mining.

Employment And Strategic Impact

The project is expected to create 3,000 to 5,000 direct jobs at steady-state operations and 20,000 to 35,000 indirect and induced livelihoods across the regional supply chain.

The project aligns with the National Coal Gasification Mission's objective of 100 million tonnes of coal gasification by 2030 and could help reduce India's dependence on crude oil imports, which expose the economy to price volatility, currency risk and geopolitical disruptions, including events such as the Strait of Hormuz closure.

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