Coal To Liquid (CTL) Market Size, Share & Industry Analysis, By Liquefaction Process (Direct Coal Liquefaction , Indirect Coal Liquefaction), By Product (Diesel, Gasoline, Other Fuels) And Regional Forecast, 2026-2034

The global coal to liquid market size was valued at USD 4.59 billion in 2025. The market is projected to grow from USD 5. billion in 2026 to USD 9.84 billion by 2034, exhibiting a CAGR of 8.83% during the forecast period.

Coal is an important fuel utilized worldwide to generate electricity, while petroleum fuels are commonly utilized in vehicles. Coal and petroleum fuels both majorly possess carbon, which makes the conversion of coal to liquid fuel more feasible. The production of liquid fuel from coal is also known as coal-to-liquid (CTL) technology or coal liquefaction. In this process, the produced liquid is a high-grade, clean fuel suitable for use in transport. Coal liquefaction provides various benefits. In terms of power generation, coal liquefaction is considered less expensive. Infrastructure and logistical requirements for processing and transportation of coal are lower than those for other fossil fuels such as oil and gas.

Based on the liquefaction process, the global coal to liquid (CTL) market is segmented into direct coal liquefaction and indirect coal liquefaction. Indirect coal liquefaction is the most widely used liquefaction technology. This process produces high-value and clean-burning fuels. Synthetic fuel produced using this technology can be used in conventional engines without any modification and adds to improved combustion with lower emissions. The direct coal liquefaction process is also expected to contribute significantly during the forecast period. This process is suitable for wide ranges of feeds including high-velocity bituminous coals, sub-bituminous coals with low cash, and lignites with low cash.          

Based on product, the global coal to liquid (CTL) market segmented diesel, gasoline, and other fuels. Diesel produced from CTL processes has several potential advantages. Diesel produced from crude oil contains aromatics, which on combustion produces particulates. But, diesel produced form liquefaction of coal do not contain aromatics and hence it burns much cleaner and overcome one of the major objection of diesel combustion.

Abundant availability of coal, depleting petroleum reservoirs, increased awareness about the technical expertise related to the conversion process among industrialists, and growth of transportation sector in developing nation are some factor drive the coal to liquid fuel market. As synthetic fuels obtained from the conversion of coal are cleaner than those extracted from natural reservoirs, thus the demand for coal liquefaction has increased, owing to wide support from regulatory authorities worldwide. However, the high initial investment coupled with adverse impacts on the environment from large-scale CTL plants is a major restraining factor for the global market.

Key Market Driver -

Abundant availability of coal

Key Market Restraint -

High initial investment

Key Players Covered:

Some of the major companies in the global coal to liquid market are Shenhua Group, Sasol, Linc Energy, DKRW Energy, Bumi plc, Monash Energy, Yitai Yili Energy Co., Celanese Corporation, Altona Energy, and Envidity Energy Inc.

Regional Analysis:

The global coal to liquid market is studied across different regions like North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. The Asia Pacific dominated the global market and is expected to grow at a significant pace during the forecast period. The majority of the CTL plants are concentrated around China and a few in India and Indonesia. The abundant availability of coal reserves in these countries is responsible for the rapid growth of the sector. China and India are expected to be the dominant regional coal to liquid fuel markets in the coming years due to the growing transportation sector in these countries. North America & Europe are expected to contribute notably to the global market due to the high demand for clean fuel.

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Segmentation

Key Industry Developments

• In September 2020, Coal India Ltd (CIL) has launched a global tender inviting potential bidders to build what it claims to be the country’s first coal to methanol (C2M) plant in West Bengal, with an investment of INR 60 bn (US$ 813.1 Million).
• In July 2017, the CSIR-Central Institute of Mining and Fuel Research (CSIR-CIMFR), installs and commissions first-of-its-kind coal to liquid (CTL) pilot plant for producing diesel and gasoline from coal.