NLC India Limited (NLCIL) and Reliance Industries Ltd (RIL) have joined hands to assess the viability of an underground lignite gasification project in Gujarat, as per PTI news report.
The initiative is aimed at unlocking the value of lignite reserves while supporting India's efforts to strengthen domestic fuel availability.
As part of the collaboration, the two companies will study the technical and commercial feasibility of converting lignite reserves into synthesis gas through underground gasification. NLC India owns two lignite blocks in Gujarat, which are being considered for the project.
Preliminary technical studies are currently underway. Reliance Industries has been brought into the project because of its experience in gasification technologies and downstream gas management, which could help accelerate development and address technical challenges associated with the process.
If the project progresses successfully, it could create an additional domestic source of gasified fuel at a time when global energy markets continue to face supply pressures.
Underground lignite gasification involves converting lignite deposits directly within the ground into synthesis gas, commonly known as syngas.
The resulting gas mixture contains hydrogen, carbon monoxide and other gases that can be used as industrial fuel or as feedstock for chemical and fertiliser manufacturing.
The proposed project is expected to contribute to India's energy security objectives by reducing dependence on imported liquefied natural gas (LNG).
It could also support industrial consumers seeking alternative fuel sources amid ongoing volatility in global fuel markets.
Alongside the Gujarat initiative, NLC India is advancing a ₹4,394 crore lignite-to-methanol project at Neyveli in Tamil Nadu.
The facility is expected to be completed next year and forms part of the company's wider diversification programme.
Traditionally focused on lignite mining and power generation, NLC India has expanded into renewable energy and coal mining operations in India and overseas.
The company continues to explore new ways to monetise its lignite resources while aligning with changing energy trends.
The project comes as India accelerates its gasification programme. Earlier this month, the Union Cabinet approved a ₹37,500 crore scheme to promote coal and lignite gasification projects, targeting the gasification of around 75 million tonnes of coal.
The broader national objective is to gasify 100 million tonnes of coal by 2030. The programme is also intended to reduce reliance on imports of key commodities such as LNG, urea, ammonia and methanol, where import dependence remains significant.
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As of 01 June 2026, at 2:50 PM, NLC India Limited share price is trading at ₹335.75 per share, reflecting a decline of 3.40% from the previous closing price.
As of 01 June 2026, at 2:50 PM, Reliance Industries Ltd share price is trading at ₹1,322.70 per share, reflecting a surge of 0.11% from the previous closing price.
The proposed Gujarat project reflects NLC India's efforts to diversify its resource utilisation strategy while leveraging Reliance Industries' technical expertise. If found viable, the initiative could support domestic fuel production and contribute to India's long-term energy security goals.
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Published on: Jun 1, 2026, 3:13 PM IST
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