Coal India Ltd is contemplating a major diversification as it plans to produce oil and gas from its coal in a big way as growth from its core activity is declining.
It also plans to enter commercial production of coal bed methane and expand presence in thermal & solar power generation, company executives said.
“The board of directors of Coal IndiaBSE -1.36 % is seriously contemplating diversifying into energy-related fields. The proposals are to be placed before the company board soon. While Coal India is yet to take up coal to oil and coal gasification, it has already tested the waters in thermal and solar power generation and coal bed methane.
A decade ago, Coal India had entered into talks with South Africa’s $22-billion Sasol Ltd and the world’s largest producer of coal-to-oil (CTL) for setting up at least a Rs 3,000-crore project with coal supplied from either IB-valley or Talcher in Orissa. Talks advanced but the proposal was later dropped because crude prices dipped making it uneconomic at the time. “With crude prices on the rise again, coal to oil is turning out to be attractive again,” the executive said.
Source: The Economic Times