Coal India Limited (CIL) and Bharat Petroleum Corporation Limited (BPCL), two Maharatna public sector undertakings, have signed a non-binding Memorandum of Understanding (MoU) to explore the feasibility of establishing a coal-to-synthetic natural gas (SNG) project. The MoU was signed on December 2 in Mumbai.

The project, proposed at Western Coalfields Limited (WCL), will use surface coal gasification technology. This innovative process converts coal into synthetic natural gas, offering a cleaner energy alternative while expanding the applications of coal beyond conventional usage.

The collaboration represents a significant step towards diversifying coal utilisation and enhancing energy security.

Coal India, under the Ministry of Coal, is the country’s leading coal producer and a critical contributor to India’s energy requirements. BPCL, operating under the Ministry of Petroleum and Natural Gas, has been advancing its portfolio towards cleaner energy projects.

The MoU is expected to set the stage for further technical and economic evaluations to assess the viability of the coal-to-SNG initiative.

Also read: Coal India has achieved 56% of its FY25 production target with four months to go

Meanwhile, the shares of Coal India Limited (CIL) are expected to be in focus as the company reported a 2.4% increase in coal production, reaching 471 million tonnes (MT) during the April-November period of the current financial year. This is up from 460 MT produced during the same period last year.

CIL, which accounts for over 80% of the country’s domestic coal production, also saw its production rise by 1.7% in November, reaching 67.2 MT compared to 66 MT in November of the previous year.

On the stock exchange, Coal India shares closed at ₹421.65, up by ₹5.10 (1.22%) on the Bombay Stock Exchange (BSE). While, shares of Bharat Petroleum Corporation Limited (BPCL) closed at ₹294.30, gaining ₹2.00 (0.68%) today.