Reliance Industries has proposed a ₹2.73 lakh crore investment in Andhra Pradesh for an Underground Coal Gasification project. The proposed UCG complex will be developed around the Chintalapudi and Recherla coal blocks in Eluru district.

Reliance Industries Limited has proposed investing around ₹2.73 lakh crore over 30 years to develop what is planned as India’s first integrated Underground Coal Gasification complex in Andhra Pradesh’s Eluru district.

The ambitious project will be developed around the Chintalapudi and Recherla coal blocks and could become one of the largest energy investments proposed for the state. However, the full investment is not yet unconditional. Reliance’s expansion into large-scale development and production will depend on exploration results and confirmation that underground gasification is commercially viable.

Reliance secured the Recherla and Chintalpudi Sector A1 blocks under the 14th round of commercial coal mine auctions. The Ministry of Coal signed development agreements with successful bidders in April 2026, marking India’s first commercial coal auction tranche with specific Underground Coal Gasification provisions.

The investment is expected to proceed in phases rather than being deployed immediately. The initial exploration and pilot stage is expected to begin during the current financial year and could involve investment of up to ₹3,000 crore. If the pilot establishes technical and commercial feasibility, Reliance could move into a much larger development phase followed by full-scale production.

The Chintalapudi block covers about 3,000 acres and is estimated to hold 904.94 million tonnes of coal, while Recherla spans around 5,500 acres with estimated reserves of 2,225.67 million tonnes. Together, the blocks contain estimated resources of more than 3.13 billion tonnes, with coal deposits located more than 600 metres underground.

Underground Coal Gasification converts deep coal into synthesis gas, or syngas, while the coal remains underground. This could allow resources considered difficult or uneconomical to mine conventionally to be used for energy, chemicals and other industrial applications.

If the project advances to steady-state operations, it is estimated to support around 3,000 to 5,000 direct jobs. Another 20,000 to 35,000 indirect and induced livelihoods could emerge through construction, transport, services, maintenance and regional supply chains.

The scale of the proposal could therefore have a broader economic impact on Eluru and surrounding areas. Local businesses, infrastructure providers and skilled workers could benefit if exploration leads to full commercial development.

The employment projections, like the overall investment figure, remain dependent on the project progressing successfully beyond its initial exploration and pilot stages.

The proposal also fits into the Centre’s National Coal Gasification Mission, which targets 100 million tonnes of coal gasification capacity by 2030. The Coal Ministry said in July that around 22.6 million tonnes per annum of capacity was already operational or under implementation.

Reliance has said UCG could convert low-quality and otherwise uneconomic coal into syngas and potentially reduce reliance on imported LNG.

If exploration confirms commercial viability and the full project moves forward, the ₹2.73 lakh crore proposal could become a landmark industrial investment for Andhra Pradesh and a major test of Underground Coal Gasification technology at an integrated scale in India.