Bharat Heavy Electricals Limited (BHEL) has announced the receipt of a Letter of Acceptance (LOA) from Bharat Coal Gasification and Chemicals Limited (BCGCL). This contract, valued at approximately INR 2800 Crores (excluding duties), is for the Syngas Purification Plant (LSTK 2 Package) under BCGCL’s Coal to 2000 TPD Ammonium Nitrate Project in Odisha. BHEL, being a promoter of BCGCL, confirms the transaction is at ‘arms length.’
BHEL Secures Major Contract from JV Company
Bharat Heavy Electricals Limited (BHEL) has formally received a Letter of Acceptance (LOA) dated February 10, 2026, from Bharat Coal Gasification and Chemicals Limited (BCGCL). BCGCL is a joint venture company comprising Coal India Limited (51%) and BHEL (49%). The official communication regarding this award was dated February 10, 2026.
Project Details and Value
The contract relates to the Syngas Purification Plant (LSTK 2 Package) for BCGCL’s ambitious Coal to 2000 TPD Ammonium Nitrate Project located in Lakhanpur, Jharsuguda District, Odisha, India. The broad consideration size for this order is approximately INR 2800 Crores, excluding Custom Duty and GST.
Scope of Work and Execution Timeline
The scope encompasses comprehensive services: Design, Engineering, Supply of equipment, Civil works, Erection, Commissioning, and O&M Services for the LSTK 2 Package. The execution schedule is defined as follows: Preliminary Acceptance (including Commissioning & Performance Guarantee Test) is targeted within 42 Months from the date of the LOA, followed by 60 Months of O&M Services from the date of Preliminary Acceptance.
Related Party Transaction Disclosure
The document confirms that BHEL is one of the promoter companies of BCGCL and also serves as the Executing agency for this specific contract. Consequently, the order falls within the purview of related party transactions, but BHEL asserts that the transaction is conducted at “arms length”.
Source: BSE
