Bharat Heavy Electricals Limited has awarded a ₹480.73 crore contract to Ellenbarrie Industrial Gases Limited for the supply and erection of a large cryogenic Air Separation Unit for a proposed coal-to-ammonium nitrate project at Bandhabal in Jharsuguda district, Odisha.
The contract was formally awarded on September 28, 2026, and covers a 1,200-tonne-per-day Air Separation Unit that will support a 2,000-tonne-per-day coal-to-ammonium nitrate project. The order is domestic and will be executed on a turnkey basis over 24 months.
1,200 TPD Cryogenic Air Separation Unit
The project involves the design, engineering, supply, erection, testing, pre-commissioning, trial-run operations, operator training, demonstration of performance guarantees, supply of spares and final handover of the complete Air Separation Unit.
The ASU will have a capacity of 1,200 tonnes per day and will form a critical part of the larger coal gasification and ammonium nitrate production complex planned at Bandhabal.
Cryogenic Air Separation Units are used to separate atmospheric air into industrial gases such as oxygen and nitrogen at very low temperatures. Large coal gasification projects require substantial quantities of these gases as process inputs, making the ASU one of the core enabling systems of the overall plant.
Contract Valued at ₹480.73 Crore
Ellenbarrie Industrial Gases disclosed that the total value of the BHEL contract is ₹480.73 crore, excluding GST.
The company has stated that the project will be executed over eight quarters and is expected to be commissioned during FY2028-29. The contract follows a Build and Transfer model, which means Ellenbarrie will design, construct and commission the plant before handing it over rather than retaining long-term ownership or operational responsibility.
For Ellenbarrie, the project will be the largest Air Separation Unit it has built to date and will take the company into the category of Indian industrial gas companies capable of executing plants with capacities exceeding 1,000 tonnes per day.
Part of India’s Coal Gasification Push
The project is connected to India’s wider coal gasification strategy, under which the government is encouraging greater conversion of domestic coal into chemicals, fertilisers, fuels and other industrial feedstocks.
India has set a long-term objective of gasifying 100 million tonnes of coal annually by 2030. Coal gasification can be used to produce synthesis gas, which can subsequently serve as a feedstock for ammonia, methanol, hydrogen, fertilisers and other downstream chemicals.
Large-scale oxygen production is essential to many gasification processes. This creates a parallel requirement for cryogenic Air Separation Units capable of supplying oxygen and nitrogen continuously and at industrial scale.
The BHEL-Ellenbarrie project therefore represents an important piece of process infrastructure within the broader effort to build domestic coal-to-chemicals capacity.
Strategic Importance for Ammonium Nitrate Production
The proposed plant at Bandhabal is designed for production of 2,000 tonnes per day of ammonium nitrate.
Ammonium nitrate has extensive industrial use, particularly in mining, infrastructure and commercial blasting applications. Building domestic capacity for its production can reduce reliance on imported feedstocks while strengthening supply availability for sectors that depend on bulk industrial explosives and fertiliser-related chemical inputs.
The project also reflects the growing integration of Indian heavy-engineering companies, process-technology providers and industrial gas manufacturers in large domestic chemical and energy projects.
BHEL Expands Its Role Beyond Conventional Power Equipment
BHEL is widely known for its role in power-generation equipment, but the company has increasingly expanded into engineering projects involving transportation, defence, process industries, renewable energy and strategic industrial infrastructure.
The Bandhabal contract illustrates this broader engineering role. BHEL is acting within a large coal-to-ammonium nitrate project that combines heavy engineering, process systems and specialised industrial-gas infrastructure.
Such diversification is important as India develops new domestic supply chains for sectors that require complex engineering and long-duration project execution.
Ellenbarrie Strengthens Large-Scale Engineering Capability
Ellenbarrie Industrial Gases manufactures and supplies oxygen, nitrogen, argon, hydrogen and specialty gases across industries including steel, pharmaceuticals, healthcare, engineering and chemicals.
The company also operates merchant and onsite industrial gas plants across India.
Securing the BHEL order expands Ellenbarrie’s role from conventional industrial gas supply into large turnkey cryogenic infrastructure. The company has described the order as an important milestone because it demonstrates its capability to deliver technically sophisticated Air Separation Units for large process-industry applications.
The project also positions Ellenbarrie to participate in future opportunities emerging from India’s planned expansion of coal gasification and domestic chemical manufacturing.
Building Indigenous Industrial Infrastructure at Scale
The BHEL-Ellenbarrie contract brings together two Indian companies in a project that requires advanced cryogenic engineering, large-scale fabrication, process integration and long-term execution capability.
The 1,200 TPD Air Separation Unit will form a core process system within the Odisha coal-to-ammonium nitrate project and will support India’s broader effort to strengthen domestic production of strategic industrial chemicals.
With commissioning targeted for FY2028-29, the project adds another large indigenous engineering capability to India’s expanding coal-gasification ecosystem and reinforces the role of domestic companies in building complex industrial infrastructure at scale.
References
Ellenbarrie Industrial Gases Limited — Regulation 30 Disclosure: Contract Awarded by Bharat Heavy Electricals Limited, 28 September 2026
https://ellenbarrie.com/wp-content/uploads/2026/09/Announcement-Awarding-of-Contract-BHEL-28092026.pdf
Ellenbarrie Industrial Gases Limited — Press Release: ₹481 Crore Air Separation Unit Contract from Bharat Heavy Electricals Limited, 28 September 2026
https://ellenbarrie.com/wp-content/uploads/2026/09/Announcement-Press-Release-BHEl-28092026.pdf
Ellenbarrie Industrial Gases Limited — Investor Relations
https://ellenbarrie.com/investors/
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