More than 50% of the gross reserves of Giral block, Barmer district, western Rajasthan are low grade having a calorific value less than 2,150 kcal/kg; therefore, it does not possess significant market values as a combustible fuel. The clay lignite inter-burden waste has been transformed into marketable high calorie carbonaceous fuel, fit for on the site power generation, manufacture of cement, manufacture of tiles and bricks, using a wet sieving technique. This material was transformed into a value-added product of CV (+) 2,754 kcal/kg. The separation was highly successful with more than 58% recovery. The separation technique involved the inherent self-disintegration behavior of the mineral in water followed by wet sieving and separating + 1 mm fraction.