Axis Energy Gets Allocation Orders for Two Odisha Coal Blocks for Underground Gasification
Hyderabad, Aug 21 (TNT): Hyderabad based Axis Energy has received Allocation Orders for two coal blocks in Odisha for underground coal gasification, marking the completion of the coal block allocation process for the projects.
The company was declared the successful bidder for Tangardihi East Coal Mine and Dip Extension of Belpahar Coal Mine, located in Sundargarh and Jharsuguda districts respectively, and executed the Coal Block Development and Production Agreement on April 28, 2026.
The two blocks were auctioned under the 14th Tranche of Commercial Coal Mine e-auction conducted by the Ministry of Coal.
The tranche marked the first allocation of coal mines for exploring underground coal gasification, in line with the National Coal Gasification Mission’s objective of achieving 100 million tonnes of coal gasification by 2030.
The issuance of the Allocation Orders will enable Axis Energy to proceed with the applicable Mining Lease or Prospecting Licence from the Odisha government.
Underground Coal Gasification (UCG) is an in-situ process that converts deep-seated coal that is not viable for conventional mining into synthesis gas, or syngas, without physically extracting the coal.
The Tangardihi East coal block, located in the IB Valley, is spread over around 6,500 acres and is estimated to contain around 4,500 million tonnes of G-13 grade coal while the Dip Extension of Belpahar block covers around 4,300 acres and is estimated to contain around 2,500 million tonnes of G-10 grade coal.
Together, the two blocks hold an estimated 7,000 million tonnes of coal resources that could potentially be utilised through underground gasification.
The projects are expected to involve an initial investment of more than Rs 30,000 crore to establish the viability of underground gasification.
Under the allocation terms, the successful bidders have the flexibility to utilise the coal blocks for conventional coal mining, coal gasification, including surface and underground gasification, coal liquefaction and export.
The flexibility is aimed at encouraging investment and technological development in coal gasification, which remains at a nascent stage in India.
Reliance Industries Ltd and Axis Energy were allotted two mines each in Andhra Pradesh and Odisha respectively under the 14th tranche.
RIL has also announced an investment of more than Rs 2.7 lakh crore in underground coal gasification projects in Andhra Pradesh.
Underground coal gasification could help unlock deep-seated coal resources that are otherwise difficult to recover through conventional mining and convert them into a source of energy.
The projects are also expected to support efforts to reduce India’s dependence on crude oil imports and strengthen energy security by reducing exposure to global price volatility and supply disruptions.
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