RIL Planning $7.5 Billion Indian Coal-to-Liquid Project with KBR, Headwaters

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Researched by Industrial Info Resources (Sugar Land, Texas)-- KBR Incorporated (NYSE:KBR) (Houston, Texas) and Headwaters Incorporated (NYSE:HW) (South Jordan, Utah) have joined with India's Reliance Industries (RIL) to launch an 80,000-barrel-per-day coal-to-liquid (CTL) project. It is reported that RIL has requested the allocation of three coal blocks from the government to feed the project. The coal blocks are Bankhui, Sakhigopal B and Alaknenda in the Talcher District of Orissa, and they are estimated to contain about 1,600 million tons of geological coal reserves. In the last budget, the government broadened the scope of captive project coal mines to cover both gasification and liquefaction. The $7.5 billion project will require a coal feed of about 30 million tons per annum.

In another coal-based project, RIL is investigating underground coal-gasification (UGC) projects, which some industry sources say are more feasible than CTL projects. RIL is in talks with BP (NYSE:BP) (London) on the technology to be used. The company has also reached an understanding with the state governments of Gujurat and Rajasthan on UGC projects. In Madhya Pradesh, RIL has been awarded four coal blocks to feed UGC projects.

Headwaters Technology Innovations Group is developing a range of breakthrough technologies that improve natural resource utilization, including heavy oil upgrading, CTL and nanocatalyst applications. Other divisions of the Headwaters group are Headwaters Energy Services Headwaters Resources and Headwaters Construction Materials. For the year ending September 2007, the group had revenues of $1.21 billion.

In October 2007, the South African company Sasol Limited (NYSE:SSL) (Johannesburg, South Africa), a global leader in CTL technology and projects, was reported to be considering an investment of $6 billion in CTL projects in the Indian state of Assam.

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