A joint venture between the Tata Group and South Africa’s Sasol plans to invest $10 billion (Rs 46,820 crore) in a coal-to-liquid project in Orissa by 2018, said Mark Schnell, president, Sasol India.
Production of fuel from the Orissa coal block will begin in 2018 and will be ramped up to 80,000 barrels per day of oil product within a year.
The project is in its early stages and investment will be equally divided between the two partners. While the joint venture had initially estimated spending $10 billion, the actual investment may be lower than that, Schnell said.
The total capital investment will be made for acquisition of mines, land and setting up the plant and logistics.
The production could be 75 per cent ultra-clean diesel and 25 per cent chemical naphtha. Some amount of urea, ammonia and jet fuel may also be produced, he said. “Our initial focus will be on the domestic market. A sizeable quantity of clean diesel will be produced. The market will decide on fuel type.”
The life of the field is 25 to 30 years, he said. The block is expected to have 1.5 billion tonnes of geological reserves and at a peak rate the joint venture expects to produce 20 million tonnes a year of coal.