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Coal India Forms JV with GAIL to Enter Synthetic Natural Gas Sector

Written by: Team Angel OneUpdated on: Mar 26, 2025, 1:54 PM IST
Coal India Ltd. and GAIL have jointly launched Coal Gas India Ltd. to enter the synthetic natural gas sector.
Coal India Forms JV with GAIL to Enter Synthetic Natural Gas Sector
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Coal India Ltd (CIL), a Maharatna public sector company, has officially incorporated Coal Gas India Ltd., a joint venture (JV) with GAIL (India) Ltd. This move marks Coal India’s expansion into the synthetic natural gas (SNG) sector, aligning with its diversification strategy.

Formation and Structure of Coal Gas India Ltd.

On Tuesday, March 25, GAIL (India) and Coal India announced the incorporation of a joint venture (JV) with the objective of establishing a coal-to-synthetic natural gas (SNG) project in the eastern coalfield. This follows the JV agreement announced in August 2024. Coal India has an authorised share capital of ₹11 Crore, with an initial paid-up capital of ₹1 lakh in the company.

Coal India holds a 51% stake in the subsidiary, contributing ₹51,000, while GAIL owns 49% with an investment of ₹49,000. Coal India possesses 5,100 equity shares of the company, each with a par value of ₹10. Similarly, GAIL holds 4,900 equity shares, also with a par value of ₹10.

Coal India secured approval from the Ministry of Coal, DIPAM, and NITI Aayog on February 19, 2025, for the creation of this joint venture.

Objectives and Future Plans

Coal Gas India Ltd. is set to develop a coal-to-SNG business, with plans to manufacture SNG and other chemical compounds after thorough market research. The company will establish necessary plants, engage in captive coal mining, and import coal equipment and infrastructure.

 

Additionally, the JV aims to augment coal processing facilities, including coal beneficiation and associated infrastructure. These initiatives are expected to support Coal India’s long-term growth and contribute to energy sector advancements.

Coal India Share Performance 

As of March 26, 2025, at 9:38 AM, Coal India share price is trading at ₹399.95 per share, reflecting a surge of 0.41% from the previous day’s closing price. Over the past month, the stock has registered a profit of 9.92%.

Conclusion

Coal India’s entry into the SNG segment through this joint venture marks a significant strategic diversification. With strong backing and planned investments, Coal Gas India Ltd. is poised to play a crucial role in India’s transition towards alternative energy sources.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Published on: Mar 26, 2025, 1:54 PM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

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