THEBUSINESSBYTES
BUREAU
NEW
DELHI, APRIL 28, 2026
In
a landmark move that could redefine India's coal sector and accelerate its clean
energy ambitions, the Ministry of Coal on Tuesday signed Coal Mine/Block
Production and Development Agreements (CMDPAs) for four commercial coal mines
under the 14th round of commercial coal mining auctions. Notably, these are the
first commercial coal blocks in the country to incorporate embedded provisions
for Underground Coal Gasification (UCG), a breakthrough technology poised to
unlock the untapped potential of India's vast coal reserves.
The
agreements mark a significant milestone in India's journey towards energy
self-reliance, technological innovation, and efficient resource utilisation.
Reliance Industries Limited emerged as the successful bidder for the Recherla
and Chintalpudi Sector A1 coal mines, while Axis Energy Ventures India Private
Limited secured the Dip Extension of Belpahar and Tangardihi East coal mines.
Located across Andhra Pradesh and Odisha, the four blocks include two partially
explored and two fully explored mines.
UCG
represents a revolutionary approach to coal utilisation — one that converts
coal into synthetic gas in situ, directly within the seam, without the need for
conventional mining. This technology unlocks energy from deep, thin, or
otherwise unworkable coal seams that traditional extraction methods cannot
economically access, significantly expanding India's exploitable energy
resource base. By integrating UCG provisions into CMDPAs for the first time,
the Ministry of Coal has future-proofed these mines, enabling operators to
pursue this cutting-edge pathway to cleaner and more efficient energy
production alongside conventional extraction.
The
initiative underscores India's strategic push not only to enhance domestic coal
production but also to create greater value across the coal economy.
UCG-derived syngas offers substantial downstream opportunities, particularly in
fertilisers, chemicals, and clean fuels. It can serve as a critical domestic
feedstock for manufacturing urea and ammonia, thereby reducing India's
dependence on imported fertilisers and bolstering food security.
In
addition, the chemicals and petrochemicals sectors stand to benefit
significantly, as UCG syngas can replace imported natural gas and naphtha in
the production of methanol, dimethyl ether (DME), and synthetic fuels. This
will strengthen India's industrial competitiveness while supporting the broader
goal of import substitution.
With these four agreements, the total number of CMDPAs signed under commercial coal mining auctions has risen to 138 mines, representing a peak rated capacity of 331.544 million tonnes per annum (MTPA). Collectively, these mines are expected to generate annual revenues of around ₹42,980 crore, attract investments worth ₹48,231 crore, and create direct and indirect employment opportunities for nearly 4.34 lakh people.
The latest development reinforces the Ministry of Coal's commitment to fostering a transparent, investor-friendly mining ecosystem while leveraging frontier technologies such as Underground Coal Gasification. As India seeks to balance energy security with sustainability, this pioneering step places the country firmly at the forefront of next-generation coal utilisation globally.
