As part of the memorandum of understanding (MoU), Gas Authority of India Limited (GAIL) will undertake technical and economic studies for setting up a commercial coal gasification plant for the production of synthesis gas while Rashtriya Chemicals and Fertilizers (RCF) will carry out studies for setting up a commercial plant to produce fertilizer by utilizing the synthesis gas from the proposed plant.

Gail stated that the project would entail an investment of around INR24 billion. The natural gas firm had earlier commissioned a study to examine the potential of the project and it is estimated that the project will produce synthesis gas equivalent to 3000 tonnes of ammonia and 3500 tonnes of urea per day.

Gail said that it will focus on the production and marketing of synthesis gas which will be in line with its core function of gas handling.

Both the companies will also jointly evaluate the potential of coal gasification for the fertilizer industry and provide assistance to each other for the successful implementation of the projects.