Bangladesh to have a coal policy by year-end

Bangladesh to have a coal policy by year-end
Nizam Ahmed

Bangladesh is likely to announce its coal policy by the end of the current year or early next year for commercial exploration of coalfields, officials said.

The policy will also empower the relevant authorities to supervise and monitor exploration and distribution of the mineral by the selected firms, they said.

Experts and officials have been working on the national coal policy, interweaving suggestions from groups, individuals and thinktanks, officials of the power, energy and mineral resources ministry said.

They said a coal policy was essential to have a concerted national effort for exploration of the mineral resource, which was needed urgently to solve widening power crisis in the country.

Bangladesh presently has a shortfall of some 1,500 megawatt (mw) electricity, as public and private power plants generate a maximum of 5,000 mw against peak-hour requirement of 6,500 mw, officials of Bangladesh Power Development Board (BPDB) said.

BPDB, signs deals with foreign firms on behalf of the government for setting up power plants, monitors generation and transmission of power in the public and the private sectors.

Though a policy is not mandatory for exploration of mineral, it in a way help tackle some pressure groups that have been obstructing government efforts for exploration, officials of the energy ministry said.

“There is no coal policy as such in any of the coal mining and exporting countries, but we think it may help us to tame pressure groups,” a senior official of energy ministry said.

Due to the opposition from some pressure groups, Bangladesh, which has a big reserve of some 3.4 billion tonnes of coal, could not go for effective exploration of the mineral.

Despite a huge deposit, the country now produces only about 2,000 tonnes of coal from Barapukuria coalmine a day, using underground mining method.

Experts said exploration of coal was most essential if the country wanted to implement its mega plan to generate 20,000 mega watt (mw) electricity by 2021.

“Let alone the implementation of the mega plan, without exploration of coal, meeting the perennial shortage of electricity may also not be possible,” a spokesman of the ministry said.

The pressure groups, who were mostly debating on the method of exploration and on the issue of paying compensation to the affected people say, an open-pit mining system, favoured by the experts and the relevant authorities, will create environmental hazards and displace millions of people.

But on the contrary the experts say the other system that is underground mining is risky, and not viable as it tends to causes subsidence of land following underground mining.

The pressure groups also oppose giving exporting rights to the exploring companies. The experts say that exploration firms should be allowed to export coking-coal, which is needed for manufacturing steel from iron.

Bangladesh has six coal fields in northern Barapukuria, Phulbari, Khalaspur, Dighipara, Jamalganj and Kuchma.

The present extraction at Barapukuria is not even sufficient to run a 250 mw coal-fired power plant at the mine site some 414 km (258 miles) north of the capital Dhaka, officials of the Bangladesh Power Development Board said.

The coalfield had an estimated deposit of 640 million tonnes of bituminous coal at a depth of 118-509 metres, at the beginning of extraction in 2004.

A Chinese consortium led by China National Machinery Import and Export Corporation developed the Barapukuria coal mine in 2004-05 under a deal signed with the Petrobangla a decade earlier.

The exploration at another prospective site at Phulbari coalfield near Barapukuria, could not be started after the contracted explorer – the U.K.-based Asia Energy Plc was forced to withdraw following a deadly protest at the site on August 30, 2006.

Six people were killed when police opened fire to disperse thousands of protesters from attacking Asia Energy staff at Phulbari, a police record said.

Phulbari has an estimated deposit of 420 million tonnes, a data of Petrobangla said.

Because of these unfortunate incidents Bangladesh despite having big reserves will have to import coal to run several proposed coal-fired power plants to be operational by2014.

Of the proposed plants the authorities have recently approved two coal-fired plants, each of 1,320 mw to be set up in Chittagong and Khulna by 2015.

Bangladesh Power Development Board (BPDB) and India’s state-owned the National Thermal Power Corporation will set up the plants under joint venture.

To run the plants some 3.0 million tonnes of coal will be needed to be imported, BPDB officials said.

The authorities also floated international bids to set up four coal-fired plants of up to 650 mw each, in Chittagong, Mawa and Khulna.

Experts say all these coal-fired plants will not be viable if coals are imported and they suggested that the authorities must go for commercial exploration of coal fixing all the problems including opposition from pressure groups.

“The authorities should tame the pressure groups and go ahead for exploration if the country really wants to use coal for generation of electricity,” Prof. Mohammad Tamim, head of the department of mineral resources engineering of the Bangladesh University of Engineering and Technology told the FE.

He advised the authorities to engage foreign fund and expertise to explore the mineral as a primary fuel to generate electricity.

“Otherwise the efforts to solve energy crisis in the country will fail and the economy will derail with lack of investment,” Tamim, who is also a former special assistant to the past interim government for energy affairs, said.

Without effective supply of electricity no firm from home and abroad will come to invest in the country, Tamim said.

Due to violent protests over the last several years, the successive governments failed to start mining at the coalfields, experts said.

There has been much foot-dragging on whether to go for underground mining or open-pit method for extracting coal and facilitating its wider use, they said.

They said that up to 90 per cent of coal could be extracted through open-pit mining and that the country’s estimated coal reserve was enough to generate electricity for 30 years.

Experts advised that the authorities must go ahead with plans to extract coal at the shortest possible time, because the use of the traditional source of energy will decline in the future on environmental concerns.

The prospects for exploiting the country’s coal reserves would increasingly dwindle, in the wake of the developments in the world energy sector, particularly in areas of renewable energy sources, a senior official of Petrobangla, the exploration wing of the energy ministry, said.

Renewable energy has started replacing non-renewable ones like coal and the use of coal will be outdated and obsolete in next three to four decades.


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