Reliance Plans $4.6 Billion Coal-to-Gas Project in India

Reliance plans a ₹43,000 crore underground coal gasification complex in Andhra Pradesh, with potential lifetime investments of ₹2.7 lakh crore and 40,000 direct and indirect jobs.

Reliance Industries Limited (RIL) plans to invest approximately ₹43,000 crore ($4.59 billion) to develop an integrated underground coal gasification complex in Andhra Pradesh, marking a major proposed investment in India's energy and industrial infrastructure. The project aims to convert deep underground coal reserves into usable gas without conventional mining and could attract additional investments of up to ₹2.7 lakh crore over its operational lifetime.

According to a draft agreement between Reliance Industries and the Andhra Pradesh Economic Development Board (APEDB), the project will be implemented in two phases, subject to technical feasibility and regulatory approvals. The APEDB will serve as the nodal agency, coordinating with state government departments to facilitate access to land, water and electricity, while also engaging with relevant central ministries.

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The first phase involves an estimated investment of ₹3,000 crore and will focus on exploration, seismic data acquisition, geological assessments and pilot demonstrations. These activities will help determine the technical and commercial viability of underground coal gasification at the identified locations.

The second phase will involve an initial investment of approximately ₹40,000 crore. It will proceed after the successful completion of the initial exploration and pilot activities, submission of a detailed project report and receipt of the necessary regulatory approvals. The proposed development will therefore depend on the outcomes of the first phase.

Reliance secured the Chintalpudi Sector A1 and Recherla coal blocks in Andhra Pradesh's Eluru district in April 2026 through India's first commercial coal block auctions that permitted underground coal-to-gas conversion. The proposed complex will use underground gasification technology to transform coal deposits into gas without extracting the coal through conventional mining operations.

The project is expected to generate approximately 5,000 direct jobs and 35,000 indirect employment opportunities. Its development could also create business opportunities across engineering, equipment manufacturing, infrastructure, technical services and industrial supply chains.

The proposed investment aligns with India's broader efforts to expand domestic coal gasification capabilities and reduce dependence on imported fuels and industrial chemicals. The Ministry of Coal has set a target of achieving 100 million tonnes of annual coal gasification capacity by 2030. The government has also introduced a ₹37,500 crore incentive programme to encourage investments in coal gasification projects, offering financial support of up to 20% of eligible plant and machinery costs.

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Reliance's proposed project adds to Andhra Pradesh's growing investment pipeline across energy, technology and manufacturing. However, the ₹43,000 crore investment remains conditional on feasibility assessments and regulatory clearances, while the larger ₹2.7 lakh crore figure represents potential investment over the project's lifetime rather than an immediate capital commitment.