KOLKATA (miningweekly.com) – India’s Steel Ministry is exploring the feasibility of constructing a coal gasification plant at Indian Coal Ventures Limited’s (ICVL’s) Mozambique coal mine.

The Steel Ministry has put a coal gasification plant proposal on the table close on the heels of ICVL floating a tender to appoint a mine developer operator for its coal mine located in Tete province of Mozambique.

The coal gasification plant, once found economically feasible for construction, would provide the option to ICVL to tackle production of low steam grade coal from the mine, which would not find many takers, a government official said.

He said that it had been estimated that only 35% of production from the mine at Tete would be coking coal and suitable to be shipped back to India to meet growing demand from domestic steel mills.

However, the bulk of production of steam grade coal from the mine would not be viable to be shipped to India. At the same time, the expression of interest floated by ICVL seeking buyers in Mozambique or neighbouring countries for steam grade coal had not evoked any interest either, the official said.

Even a proposal to set up a thermal power plant linked to ICVL’s mine through private investments did not come to fruition in the face of problems related to evacuation of electricity generated from such a project, leaving the Indian miner with problems of surplus steam coal.

If steam coal could be converted to gas, it would become viable for transporting the gas back to India given that an estimated 14 000 MW of gas-based power plants were idling across the country in the face of a gas shortage, the official said.

ICVL was promoted in 2008 as an exclusive entity to acquire coal assets overseas to meet rising Indian demand for coking coal including as principal prompter of consortium. The latter included the country’s largest steel producer, Steel Authority of India Limited, iron-ore miner, NMDC Limited and southern India-based steel mill, Rashtriya Ispat Nigam Limited.