Press Release: Asian Development Bank Pulls Out of Controversial Phulbari Coal Project in Bangladesh!

Press Release: April 3, 2008

 

BanglaPraxis ● Bank Information Center

● International Accountability Project

Urgewald ● World Development Movement

 

Photo: Munem Wasif/DrikNews 

The Director of the Asian Development Bank’s Private Sector Operations Department, Robert Bestani, notified the Bank’s Board last week that it will no longer ask for approval of the Phulbari Coal Project in Bangladesh. The ADB’s Board was slated to approve a US$ 100 mio. loan and US$ 200 mio. political risk guarantee for the project on June 3, 2008.

This comes as another major blow to the UK based company GCM Resources (formerly known as Asia Energy), which aims to establish one of the world’s largest open pit coal mines near the town of Phulbari in northwestern Bangladesh. GCM/Asia Energy was forced to shut down its operations and flee the project area after a major protest of over 50,000 people in 2006 resulted in three deaths and hundreds being injured as government-backed paramilitary forces fired upon the protesters. 

Since then and in spite of the Bangladesh Government’s Emergency Power Rules that ban major civil liberties such as the right to public assembly of more than five people, widespread opposition in the project area has continued. National opposition has been led by the National Committee to Protect Oil, Gas, Mineral Resources and Ports (NC). Although its General Secretary Prof. Anu Muhammad has received death threats and its local leader Mr. Nuruzuman was publicly tortured by the military in February 2007, the, NC and other civil society organizations have remained undaunted in their opposition to the Phulbari project. 

As Prof. Muhammad says:  “The area around Phulbari is extremely fertile and densely populated. It is also one of the few regions in Bangladesh that are safe from flooding and other natural catastrophes and therefore plays a key role for the food security of the entire country. The proposed “development” project is merely a scheme to loot natural resources from a poor country for the rich. We will not allow GCM Resources to turn a land of food for the people into a black hole for corporate profit.”

According to the company’s own estimates, the mine would displace some 50,000 people. However, an Expert Committee commissioned by the Bangladesh Government in 2005 found these numbers to be grossly underestimated. The Expert Committee reports that 130,000 people would be displaced for the mine and a further 220,000 would be impacted through the massive draw-down of the water table, which is necessary to keep water from running into the 300 meter deep mine pit. This would have major impacts on drinking water and irrigation for many miles beyond the actual mine. Furthermore, the company has no viable plan to prevent acid mine contamination of the soil and water as a result of mining 15 million tons of coal for over 35 years.

Mining expert Roger Moody says:  “It is extremely costly to adequately prevent and mitigate acid mine drainage in a mine of this size.  The acid is likely to stay in the environment for decades after the mine closes contaminating the land, rivers and streams.  And GCM has not provided any financial details as to who would cover the bill for such an environmental disaster.”

Various community leaders and representatives of the Phulbari area wrote a letter to the ADB’s Executive Directors in December 2007, followed by a letter by over 60 international civil society organizations protesting ADB’s involvement in the project. As international NGOs point out, the project would also cause extensive damage to the Sundarbans mangrove forest, an UNESCO declared World Heritage Site where the port facilities for exporting the coal are to be constructed. As several of the ADB’s Executive Directors began raising questions about Phulbari, the Bank’s management finally decided to take the project out of ADB’s funding pipeline.

Shefali Sharma from the US NGO Bank Information Center, which monitors the activities of multilateral development banks, comments: “Phulbari is a singularly bad project and we are amazed that the ADB spent 3 years preparing a venture, which was clearly going to impoverish an immense number of people and risk an environmental catastrophe in the entire region. This raises serious questions about the bank’s due diligence and should encourage donor countries to strengthen their oversight and call for a reform of the institution.” 

Tim Jones of the World Development Movement adds: “ The Phulbari project is truely a British and international scandal. GCM Resources is a British company and is backed by banks such as Barclays (UK), UBS and Credit Suisse (Switzerland). Among its other investors are the British hedge fund RAB Capital and the mutual funds manager Fidelity from the US. The ADB’s decision sends an important signal to these institutions about the inacceptability of their investment into this project.”

Bangladesh, British and international civil society organizations are now calling on these financial institutions to follow suit and pull the plug on the Phulbari coal project.

For further information contact:

Zakir Kibria, Tel: +8801714116020 (Dhaka, Bangladesh)

Heffa  Schücking, Tel: +49-160-96761436 (Germany)

Tim Jones, Tel: +447817628196 (WDM, London, UK)

Shefali Sharma, Tel: +91 9871168212 (Bank Information Center, South Asia Office, Delhi, India)

Jennifer Kalafut, Tel: +12024154047 (International Accountability Project, U.S.)

Notes to the editor:

The Bangladesh Government originally awarded an exploration license to the Australian company BHP Minerals in 1994, which however, decided against developing a coal mining operation in the area. In 1999 its licenses were transferred to Asia Energy Corporation (Bangladesh) Pty Ltd. Asia Energy PLC was incorporated in London Stock Exchange Alternative Investment Market (Ticker code: GCM) in September 2003 and acquired 100% of Asia Energy Corp. It subsequently changed its name to Global Coal Management after August 2006 killings in Phulbari and to GCM Resources Plc in December 2007. According to the company’s 2007 annual report, its major shareholders are RAB Capital, UBS, Fidelity Group, Barclays, Credit Suisse, LR Global, Ospraie Management, Capital Group and Argos Greater Europe Fund. GCM Resource’s financial advisor is Barclays and its principal banker is the Bank of Scotland. 

Further information: 

Read a news report: Asian bank scuppers UK mine project in Bangladesh (Observer, UK)

Read a critique of the Phulbari Coal Project: Phulbari coal mine - losses beyond compensation (By Chris Lang)

 

Phulbari coal mine - “losses beyond compensation”

By Chris Lang.  March 2008.

 

 

A UK company is planning to build a huge coal mine in Bangladesh. The impacts would be devastating. The Asian Development Bank is considering supporting the project anyway.

The proposed Phulbari open pit coal mine in Bangladesh would divert a river, suck an aquifer dry for 30 years and evict thousands of people from their homes. Vast machines would dig a series of holes 300 metres deep over a total area of 59 square kilometres. The coal would be largely exported via a railway and port in the Sundarbans, the world’s largest mangrove forest.[1]

The company behind the US$1.4 billion scheme,[2] Asia Energy Corporation (Bangladesh), is a wholly owned subsidiary of a UK company, Global Coal Management Resources. The largest shareholder in GCM Resources is RAB Capital, a London-based hedge fund manager. Other shareholders include UBS, Credit Suisse and Barclays.[3] In June 2008, the ADB’s board is scheduled to decide whether or not to provide a US$100 million loan and US$200 million political risk guarantee for the project.[4]

During an ADB mission to Bangladesh in October 2007, mission leader Kunio Senga told journalists that “coal mining is going to give huge potential benefit for power generation.” Senga added, “Coal mining is very effective.”[5]

The mine would displace 40,000 people according to Asia Energy. Activists state that the number of people affected could be more than ten times this figure.[6] “No matter wherever we are put, if we get evicted from our homes, we will lose our traditions, social organisation and businesses. These losses are beyond compensation,” Nima Banik, a lecturer at Phulbari Women’s Degree College told the Bangladesh NGO, Society for Environment and Human Development (SEHD).[7]

The mine would cause noise and dust pollution through dynamite explosion. More noise and dust will come from the trucks and trains that would haul the coal away from the mine. Coal dust will pollute the air. Water will be polluted from washing the coal, risking pollution of surrounding water bodies. Bangladesh has networks of hundreds of small rivers, meaning that water pollution in one area can spread over a large area.[8]

To prevent the mine from flooding, huge pumps would run 24 hours a day for the 30 years of the mining project, pumping up to 800 million litres of water a day out of the mine.[9] Groundwater in an area covering about 500 square kilometres would be lowered. Wells would no longer provide enough water for farmers. Asia Energy’s solution is to distribute the water pumped out to farmers. “It is an open question if the water distribution would be even-handed,” notes SEHD’s Philip Gain. Once the mining is finished, Asia Energy plans to create a huge lake, providing fresh water, fisheries and recreation, according to the company. But after 30 years of digging, the water will be toxic.[10]

Local opposition against the project is strong. In August 2006, about 80,000 people took part in protests against the mine. The paramilitary Bangladesh Rifles opened fire on the demonstration, killing five people and injuring hundreds. On 30 August 2006, the Rajshahi mayor, Mizanur Rahman, signed an agreement with the protesters on behalf of the government to kick Asia Energy out of the country and to ban open-pit mining in Bangladesh.[11] Well over a year later, the government has yet to scrap the deal with Asia Energy. Meanwhile the government is working on a coal policy which in its current draft form would allow open pit mining.[12]

Under the military government which declared emergency rule in January 2007, public protest is banned. Nevertheless, in December 2007, representatives of the sub-districts of Phulbari and neighbouring Birampur, Nababganj and Parbatipur wrote to the president and executive directors of the ADB. The project will “increase the poverty of the local population as well as cause environmental disaster,” they wrote.[13]

The Bangladesh government’s Department of the Environment has set up a Climate Change Cell. “Rapid global warming has caused fundamental changes to our climate. No country and people know this better than Bangladesh, where millions of people are already suffering,” states one of the Climate Change Cell’s documents. “Development must ensure reducing the risks posed by climate change to people’s lives and livelihoods,” it adds.[14]

The Climate Change Cell gets more than 90 per cent of its funding from the UK’s Department for International Development (DfID).[15] Nowhere in any of the documents on its website does Climate Change Cell mention Phulbari.[16] Yet the coal from the Phulbari coal mine, if it is extracted and burnt, will add a total of more than 1.2 billion tonnes of carbon dioxide to the atmosphere.[17]

Gordon Brown, the UK prime minister, claims to be concerned about climate change. At a recent meeting with Bangladesh’s interim head of government, Fakhruddin Ahmed, Brown promised that “Britain would continue to work closely with Bangladesh bilaterally and internationally to secure an effective response to combat climate change.”[18] The Phulbari coal mine makes a mockery of this statement.References[1] Philip Gain “Open Pit Mining for Coal: Horror Feeling Shrouds Northern Bangladesh” and “Killings in Phulbari Ignite Unstoppable Protest: Local Communities Stand Strong against Open Cut Mining“, Society for Environment and Human Development, no date.[2] “Bangladesh may re-open 1.4-billion-dollar mine deal talks“, AFP, 3 October 2007.[3] “Annual Report and Accounts 2007“, Global Coal Management Resources.[4] “BAN: PHULBARI COAL PROJECT : Bangladesh“, Asian Development Bank website.[5] “Asia Energy wants to renegotiate deal“, The Daily Star, 4 October 2007.[6] “Urgent Appeal by World Organization against Torture: Risk of Violent Suppression of Public Opposition to the Phulbari Coal Mine Project“, Phulbari Resistance, 22 December 2007.[7] Philip Gain, “Killings in Phulbari Ignite Unstoppable Protest: Local Communities Stand Strong against Open Cut Mining“, Society for Environment and Human Development, no date.[8] Anu Muhammad and SM Shaheedullah (2007) “Phulbari Day and the Coal Policy“,NewAge, 26 August 2007.[9] Engr. A K M Shamsuddin (2007) “Phulbari Coal: Hydrogeological environment not favourable for open pit mining“, The Daily Star, 29 September 2007.[10] Philip Gain, “Killings in Phulbari Ignite Unstoppable Protest: Local Communities Stand Strong against Open Cut Mining“, Society for Environment and Human Development, no date.[11] “No step yet to cancel deal with Asia Energy“, NewAge, 26 August 2007.[12] “ Bangladesh: Resistance against coal open-pit mine in Phulbari“, WRM Bulletin no 126, January 2008.[13] “Urgent Appeal by World Organization against Torture: Risk of Violent Suppression of Public Opposition to the Phulbari Coal Mine Project“, Phulbari Resistance, 22 December 2007.[14] “From Vulnerability to Resilience: Bangladesh Preparing for Climate Resilient Development“, Climate Chang Cell, February 2008.[15] “Climate Change Cell . . factsheet“. The Climate Change Cell has a total budget of US$2.1 million of which US$1.9 million will come from DfID.[16] I did a search on Google on 24 March 2008. The result: “Your search - Phulbari site:www.climatechangecell-bd.org - did not match any documents.”[17] The coal mine at Phulbari would remove 15 million tonnes of coal a year for 30 years; a total of 450 million tonnes. One tonne of coal contains 746 kg carbon. The molecular weight of carbon dioxide is 3.667 times that of carbon: 450,000,000 x 0.746 x 3.667 = 1,231,011,900. (This calculation method came from George Monbiot’s article, “Rigged“, The Guardian, 11 December 2007, footnote 5.)[18] “Bangladesh, UK to begin ‘new strategic partnership’“, The Daily Star, 19 March 2008.

International Civil Society Letter to Asian Development Bank (ADB): Discontinue Support to Phulbari Coal Project!

January 11, 2008

 

The ADB Board of Directors

Asian Development Bank

P.O. Box 7890980

Manila, Philippines

 

RE: PHULBARI COAL PROJECT (BAN 39933-01)

Dear Director:

 

We, the undersigned organizations, are writing with regard to ADB’s proposed Phulbari Coal Project (BAN 39933-01), which is scheduled for approval by the ADB Board on 27 March 2008.  We believe the Phulbari Coal Project is in violation of the ADB Energy Policy (1995), Indigenous Peoples Policy (1998), Involuntary Resettlement Policy (1995), Environment Policy (2002), and Public Communication Policy (2005).

 

The current political situation in Bangladesh does not allow freedom of speech and assembly in the region.  The project is fiercely opposed by the people of the region in the four sub-districts of Birampur, Nawabganj, Parbatipur, and Phulbari; yet public documents approved by the ADB continue to state that there is community support.  The non-transparent and unaccountable processes at the project planning stage have made us deeply concerned about the capacity of the ADB, its proposed private sector partner Global Coal Management/Asia Energy PLC, and local authorities to adequately and justly prepare for and deliver on social and environmental aspects of this project.

 

We therefore urge you to discontinue ADB’s pre-appraisal due diligence on this Project and take it out of the funding pipeline due to the following issues:

 

1)    Violation of ADB Energy Policy (1995)

The Summary Environmental Impact Assessment (SEIA) of the Phulbari project (dated August 2006 and posted on ADB website on August 16, 2006) mentions that “At full production, about 8 million tonnes will be exported by rail and barges to an offshore reloading facility at Akram Point for export to international markets, some 4 million tonnes will be exported to India via railway, and the remaining 3 million tonnes will be used for a proposed mine-site 500 MW power plant and sold for domestic use”(SEIA , page 2).

 

Paragraph 86 (ix) of ADB Energy Policy states (excerpts highlighted) that “Coal is the primary energy source in the Bank’s largest DMCs and its use is a major cause of environmental degradation. The Bank should actively promote environmentally sound mining practices and clean coal technologies. As coal is an increasingly internationally traded commodity, the Bank should not directly finance coal mine development except where it is for captive use by a thermal power plant, and economically superior to other coal supply options.”

 

We submit that the premise of the ADB Energy Policy is to only approve financing of mine-mouth projects.  Phulbari is clearly not a “captive use” mine-mouth project as the majority (almost 80%) of the coal is intended for export to India and international markets. Since the ADB Energy Policy has to apply in its entirety to the full Project –- and not merely to sub-projects in a piece meal fashion — it is our view that Phulbari Coal Project stands in violation of the ADB Energy Policy.   We are thus surprised that ADB Management cleared the concept paper for this project in October 2005 and continues to conduct “due diligence” on this project when it so clearly violates an existing Board approved policy.

 

2) Massive Displacement, Loss of Livelihoods and Basic Services

According to ADB management, Phulbari Coal Project would create approximately 50,000 affected people (12,000 affected households, including 2,200 indigenous peoples) in the project area, out of which 43,000 people will be physically displaced.[1]  According to the December 2006 version of the Resettlement Plan for the Coal Mine Area of the Phulbari Coal Project prepared by Asia Energy PLC, compensation would be provided to legal owners of land and houses, and other socially recognized agricultural land users and sharecroppers would receive livelihood restoration grants for a period of two years.

 

However, the Expert Committee formed by the Government of Bangladesh to evaluate Asia Energy’s project documents found that 129,417 persons will be directly affected by the project and 220,000 persons will be indirectly affected due to the de-watering of the mine area and because the primary source of water in this area is tubewells.[2]

 

In addition to displacement, severe loss of livelihoods will result as the land proposed for the project is one of the most fertile and populated areas in a country that is prone to chronic water-logging and where much of the land is uncultivable for many months of the year.  The recent cyclone clearly demonstrates the true value of such land for food security and habitation for the entire country.  Out of the total land proposed for the Phulbari open-pit mine, 78% is agricultural land and there is limited possibility for land rehabilitation. The majority of affected people will not be employed by the mine and projections of multiplier effects of such an operation are based on spurious grounds.  Thus the impoverishment of thousands is a likely scenario.  Given the sheer magnitude of affected people, wide spread opposition and social unrest is likely to remain an ongoing reality of this project.

 

3) Environmental Degradation

The Project will have severe environmental consequences.  First, no practical ground level tests appear to have been conducted on the actual impact of dewatering in the mining area and thus long term impacts of such a procedure on desertification in the area remain highly uncertain.  The Expert Committee Report indicates that arsenic contamination of water could be a real possibility during and after the mine life of 30-35 years given the depth of the coal extraction (656-1028 ft).  Asia Energy PLC documents suggest that land will be filled after extraction and the company will leave a freshwater lake at the end of the mine life.  However, environmental experts maintain that neither the land (dredged and rehabilitated) nor the ensuing “lake” will be conducive to agriculture or other  activities such as fisheries given the toxicity level of both.  The depletion of groundwater will impact approximately 314 sq km.  Though Asia Energy claims that it will re-inject water in the area, its discussion on this issue is based on speculative hydrological and climactic projections.[3] 

 

Second, the main coal off-loading facility will be at Akram Point, a deep water anchorage site situated within the Sundarbans Reserve Forest. The Sundarbans are a World Heritage Site given its biodiversity and marine habitat. Equally disturbing is the admission in the SEIA that shipping channels “…will pass at least 1.5 km from these protected areas” (SEIA, page 7). Moreover, preventive measures suggested in the SEIA deals inadequately with rail and river accidents frequently associated with mining activity of this scale, not to mention response to sudden large scale natural disasters as Bangladesh has recently witnessed. 

 

Finally, though the ADB continues to maintain that the EIA and SIA “have been carried out to a very high international standard by the sponsor”[4]both the EIA and the SIA have been commissioned by the same company which wishes to extract the coal; hence, serious conflict of interest issues remain endemic in the project.  This is especially so given that Asia Energy’s leadership is dubious and it has no pre-existing record of operating a coal mine.[5]

 

4) Human Rights violations

On 26 August 2006, around 20,000 local residents participated in a large peaceful gathering to protest the displacement of the large number of people to give way to the project. Regretfully, the Bangladesh Rifles opened fire on the demonstrators. Three people from the Phulbari area were killed, one paralyzed and over a 100 people were injured in the horrifying incident.  Moreover, in February 2007, Mr. SM Nuruzzaman, one of the local leaders of the Phulbari campaign, was detained and tortured.[6]

 

Based on local reports, intimidation of local community members continues, preventing them from openly gathering in groups and voicing concerns regarding this project.  However, ADB management continues to publicly support the project.  And ADB documents continue to maintain: “The entire process has been underpinned by free, prior, and informed consultations with stakeholders, including local communities, NGOs, various levels of government, inter-ministerial committees, and outside stakeholders. Public consultation has been and remains a continuous process.”[7] This is particularly disturbing given the conflicting reports from community members themselves (see Disclosure section below).

 

5) Indigenous Peoples Policy

The affected indigenous peoples of the Munda, Santal and Mahili ethnic groups have been farmers and agricultural laborers in the region for generations. The draft Indigenous People’s Development Plan (page 47) for the Phulbari project proposes indigenous families into resettlement sites with only 1/8 hectare of land per household or cash compensation for resettlement.  The resettlement sites are in areas already densely populated, with little scope to obtain alternative agricultural land and labor opportunities. It is also unlikely that they will be able to purchase land of equal productive capacity from the non-indigenous population given limited compensation offered and existing land scarcity.  The project violates ADB IP Policy with regard to consultations with these groups and given the unlikelihood of these groups to sustain their way of life under the resettlement options suggested.

 

6) Violation of the Public Communications Policy

Many local elders claim that Asia Energy Corporation has only informed prospective affectee communities of the benefits of the project, and not explained the negative impacts it may cause the environment and the local communities. They also claim that they have never received nor been consulted on any key documents, e.g. environmental impact assessment, draft resettlement plan and draft indigenous peoples development plan, among others. The chairman of the Phulbari Municipality and elected commissioners of Phulbari have demanded that Asia Energy Corporation provide them key project documents, but to no avail.  Asia Energy’s information on its Bangla website reads more like public relations documents.  Moreover, even Global Coal Management’s site no longer contains the English versions of the draft EIA, Involuntary Resettlement Plan and Indigenous People’s Plan as suggested by ADB staff.

 

Asia Energy’s Public Communication and Development Plan (PCDP) cites that 74.1% of those surveyed between February and August 2005 felt that they would support the project if there was proper compensation; however, this survey was conducted while Asia Energy gave limited information about what the project would entail.  The Expert Committee Report states that names of certain officials were listed in consultations where they were actually not present.  The President of the Expert Committee Report, Professor Md. Nurul Islam was one of them.  There are several such examples of misinformation.

 

Committee members found out that Asia Energy surveyors wrote down information and opinions of the local people in pencil while the form was written in English…local population are therefore suspicious about whether their opinion against the coalmine has been accurately reported by the surveyors…during the field visit and consultation with the local people the Committee members felt that the impression given in the [Asia Energy Feasibility Report] is far from accurate.  The majority of the local community with whom the Bangladesh Government’s Expert Committee exchanged views was against the Phulbari coal project” (See Expert Committee Report).

 

Conclusion

Asia Energy’s Public Information Center was shut down after the killings in August 2006; the Bangladesh Government also signed an agreement with community members that the company would not return to the Phulbari area.  We recognize that the current interim government under the state of emergency disregards this agreement; however, the agreement attests to the sheer lack of community support behind this project.

 

The project violates ADB social and environmental policies and its Public Communication Policy.  And given the explicit human rights violations associated and anticipated with this project, we respectfully ask you to take leadership, and ensure that the Asian Development Bank discontinues its involvement in the Phulbari Coal Project. Please note that this letter supports the letter (attached) sent to you by Community members of Phulbari and other Bangladeshi citizens, dated December 15, 2007.

 

Sincerely yours,

 

1. Hemantha Withanage -           NGO Forum on ADB

2. Bruce Jenkins             -           Bank Information Center (USA)

3. Muhammad Riza        -           Yayasan Duta Awan – Solo (Indonesia)

4. Violeta Corral                     -  Public Services International Research Unit – Asia Desk

5. Le Van Lan                 -           Center for Rural Development in Central Vietnam (Vietnam)

6. Souparna Lahiri           -           National Forum of Forest People & Forest Workers (India)

7. Jiten Yumnam                       - Citizens Concern for Dams and Development (NE India)

8. Gururaja Budhya       -             Urban Research Centre (India)

9. Nang Shining              -           Images Asia Environment Desk (Thailand)

10. Jessica Rosien           -           Oxfam Australia

11. Flint Duxfield            -           Aid/Watch (Australia)

12. Joanna Levitt             -           International Accountability Project (USA)

13. Dilena Patharagoda  -           Sri Lankan Working Group on Trade and IFIs (Sri Lanka)

14. Ravindranath Dabre -           Centre for Environmental Justice (Sri Lanka)

15. Suranjan Kodithuwakku-      Sri Lanka Green Movement (Sri Lanka)

16. Dang Ngoc Quang     -           Rural Development Services Centre (Vietnam)

17. Titi Soentoro            -           NADI (Indonesia)

18. Prof. Sanjai Bhatt    -           University of Delhi (India)

19. Prajeena Karmacharya -         Rural Reconstruction Nepal / South Asia Alliance for Poverty

Eradication (Nepal)

20. Sergei Vorsin           -           Eco Centre (Tajikistan)

21. A. Ercelan               -           Creed Alliance (Pakistan)

22. M. Nauman              -           Pakistan Institute of Labour Education & Research (Pakistan)

23. Mahar Safdar Ali      -           Anjuman Asiaye Awam (Pakistan) 

24. Azhar Lashari           -           ActionAid – Pakistan

25. Philip Gain              -           Society for Environment and Human Development (Bangladesh)

26. Fabby Tumiwa         -           Institute for Essential Services Reform (Indonesia)

27. Srinivas Krishnaswamy-          Greenpeace India

28. Ahmed Swapan        -           VOICE (Bangladesh)

29. Svetlana Spatar       -           The Ecological Society Green Salvation (Kazakhstan)

30. Zakir Kibria             -           Bangla Praxis (Bangladesh)

31. Anna Dreyzina         -           Oil Workers Rights Protection Organization Public Union

(Azerbaijan)

32. Shailendra Yashwant -           Greenpeace Southeast Asia

33. Sushovan Dhar           -           Vikas Adhyayan Kendra (India)

34. Prabin Man Singh     -           Collective Initiative for Research and Action (Nepal)

35. Naing Htoo              -           EarthRights International

36. Rustam Murzakhanov -           Researcher of Environmental Law Center “Armon” (Uzbekistan)

37. Isagani Serrano        -           Philippine Rural Reconstruction Movement (Philippines)

38. Ram Wangkheirakpam-         North East Peoples Alliance on Trade, Finance and Development

(NE India)

39. Nursaule Umbetova  -           Ecological-Lawful Initiative Center ”Globus” (Kazakhstan)

40. Parviz Umarov          -           Center for Development of Civil Society (Tajikistan)

41. Shynar Izteulouva     -           NGO “TAN” (Kazakhstan)

42. Pieter Jansen           -           Both ENDS (The Netherlands)

43. Grainne Ryder         -           Energy Probe Research Foundation (Canada)

44. Bruce Rich               -           Environmental Defense (USA)

45. Ashish Fernandes      -           Greenpeace India

46. Soile Koskinen          -           A SEED Europe (The Netherlands)

47. Isabel de la Torre    -           Earth Economics (USA)

48. Jim Enright              -           Mangrove Action Project (Thailand)

49. Dr. Mae-Wan Ho       -           Institute of Science in Society (UK)

50. Paula Palmer            -           Global Response (USA)

51. Jennifer Scarlott      -           International Conservation Initiatives Sanctuary Asia (USA)

52. Helen Leake             -           Forest Peoples Programme (UK)

53. Dr. Andreas Missbach -           Berne Declaration (Switzerland)

54. Dr. Poonam Pande

55. Yuki Tanabe              -           Japan Center for a Sustainable Environment and Society

56. Knud Vocking             -           Urgewald (Germany)

57. Suzanna Dennis        -           Gender Action (USA)

58. Peter Fugazzotto     -           Oceans and Communities (USA)

59. Sébastien Godinot    -           Les Amis de la Terre (France)

60. Saodat Saidnazarova -           CSSC “Kalam” (Tajikistan)

61. Tom Kucharz            -           Ecologistas en Acción (Spain)

62. Jenina Joy Chavez    -           Focus on the Global South (Philippines)

63. Shalmali Guttal        -           Focus on the Global South (Thailand)

64. Longgena Ginting  -              Friends of the Earth International

Cc:

Board of Directors, ADB

Haruhiko Kuroda, President, ADB

Liqun Jin, Vice President (Operations 1), ADB

Kunio Senga, Director General, South Asia Regional Department, ADB

Robert Bestani, Director General, PSOD, ADB

Hua Du, Country Director, Bangladesh Resident Mission, ADB.

Mats Elerud, Senior Investment Specialist, PSOD, Asian Development Bank

Bart Edes, Head, NGO Center, ADB

---

[1] As per Asia Energy’s Draft Resettlement Plan dated December 2006; SEIA suggests 40,000 people will be physically displaced.

[2] Report of the Expert Committee to Evaluate Feasibility Study Report and Scheme Development of the Phulbari Coal Project, pg 47. The report is in Bangla but a summary translation can be provided to you.

[3] See R. Moody, “Bangla Nagar: August 26, 2006” 28 August 2006

[4] Response from ADB President Kuroda to Civil Society Organizations about the Phulbari Coal Mine; July 23, 2007, mimeo

[5] See http://www.minesandcommunities.org/Action/press1101.htm

 

[6] http://www.newagebd.com/2007/feb/13/nat.html

[7] See SEIA, para 280

Screening of documentary film, Phulbari, roundtable discussion and exhibition

Society for Environment and Human Development (SEHD) is pleased to invite you to the premier screening of the documentary film Phulbari and a roundtable discussion on Phulbari Coal Mine and energy security of Bangladesh. Justice Muhammad Habibur Rahman will be the chief guest at the event. Eminent experts on coal, activists, economist, journalist, film critique and representatives of local communities will participate in the roundtable discussion.

Produced by Society for Environment and Human Development (SEHD) the film presents facts about grassroots revolt in Phulbari against open-pit mining and explains crucial social, environmental and economic issues involved with coal and its extraction strategies.

Please join the premier screening of the documentary film at 10:00 AM on 5 January 2008 (Saturday) followed by discussion at Drik Gallery (House 58, Road 15/A-new, Dhanmondi, Dhaka, Bangladesh).

In addition to the premier screening of Phulbari, a photography and painting exhibition will remain open from 2:00 PM to 8:00 PM on 5 and 6 January.

Contact:  Society for Environment and Human Development (SEHD) 4/4/1 (B) (3rd floor), Block-A, Lalmatia, Dhaka-1207, Bangladesh Tel: 880-2-9121385; 01715-009123 (M) Fax: 880-02-9125764 E-mail: sehd@citechco.net, info@sehd.org  Webpage: www.sehd.org

Urgent Appeal by World Organization against Torture: Risk of Violent Suppression of Public Opposition to the Phulbari Coal Mine Project

OMCT ACTION FILE (BGD 211207.ESCR)

BANGLADESH: RISK OF VIOLENT SUPPRESSION OF PUBLIC OPPOSITION TO THE PHULBARI COAL MINE PROJECT, DINAJPUR DISTRICT, BANGLADESH

Your action is called for to suspend the Phulbari Project until community concerns are met

OMCT is concerned that police and security forces may again employ violence to deal with public opposition to the Phulbari open-pit mining project  The International Secretariat of the World Organisation Against Torture (OMCT), on the basis of reliable information received, expresses its concern that communities affected by the proposed Phulbari open-pit coal mine in the Dinajpur District of Bangladesh, have been neither adequately consulted not fully informed regarding this significant project.[1] Estimates put the number of people affected by the mine at anything between 50,000 and 500,000, including a number of indigenous communities. Many of these affected will be forced to leave their homes and land. A public demonstration against the mine in August 2006 saw at least five persons killed and fifty others injured by the police and personnel of the Bangladesh Rifles. OMCT expresses its serious concern that further violence, ill-treatment and even deaths may ensue if local communities again seek to give public expression to their opposition. To prevent further human right violations, and having regard to the strong local opposition to the project, OMCT calls upon the Government of the People’s Republic of Bangladesh to instigate a thorough independent investigation into the human and environmental impact of the Phulbari coal mine project, ensuring the full and informed participation of all local communities, to make the findings of this investigation available in a public report and to abide by the recommendations of this report. It also calls for the Government to lift the restrictions on public demonstrations imposed under emergency rule and take all necessary steps to prevent future episodes of violence by police and security forces against persons defending their human rights. OMCT calls upon GCM Resources Plc (GCM) - the company in charge of the Phulbari project - to suspend its activities in this area until this investigation has been conducted and to abide by the recommendations resulting from this investigation. It also calls upopn GMC to fully respect the land rights, resources and livelihoods of all local communities affected by any subsequent mining activity and provide fair and adequate compensation wherever appropriate.  Finally, OMCT calls upon UBS, RAB Capital and Barclays, all of which have significant financial interest in GCM, to use their influence to ensure that the company abides by the recommendations issuing from the independent investigation and to make certain that it complies fully with national laws and international human rights standards.

The Phulbari coal mine project

The Phulbari coal deposit, in the Dinajpur District of Bangladesh, was discovered during the second half of the 1990s by the Australian mining company BHP. In 1998, the Government of Bangladesh awarded the licensing agreement for mining the deposit to the Asia Energy Corporation (Bangladesh) Pty Ltd,[2] a wholly-owned subsidiary of British-registered Global Coal Management Resources Plc. (GCM). The Phulbari mine is expected to lead to a 1 per cent increase in the gross domestic product of Bangladesh over the next 30 years, bringing more that US$ 21 billion to the Bangladeshi economy.[3] The Asian Development Bank is scheduled to approve a US$100 million private sector loan and a US$200 million political risk guarantee in favour of the Phulbari project on the basis of environmental and social impact studies included in a Definitive Feasibility Study carried out since April 2004.[4]

The Phulbari project is an open-pit mine.[5] In order to access the coal seams, it is reported that between 140 and 300 metres of earth will need to be removed, affecting an area of 59 km². In terms of the human impact of the project, there are differing views. According to estimates from GCM, the mining company involved, the project will affect approximately 50,000 people (a total of some 12,000 households), including some 2,200 indigenous people. Of this total, some 43,000 will be displaced from their homes and land by the mine. This number will be higher if the full-scale expansion plans for the mine are carried out. On the other hand, according to the National Committee to Protect Oil, Gas, Mineral Resources, Electricity and Ports, the number of people potentially affected could be as many as 470,000, including indigenous peoples belonging to Santhal, Munda and Mahali tribes, who occupy some 100 villages in Phulbari and surrounding sub-districts.[6]

In terms of the impact upon community structures, it is reported that the project will involve the closure of 50 educational institutions, including six colleges and 18 madrasas,[7] as well as 171 mosques, 13 temples and other religious establishments.[8] The mine will also have a significant environmental impact due to the considerable waste material produced in the extraction process. This in turn will have serious implications for the livelihood and, potentially, the health of local communities: the area around Phulbari is one of the most productive agricultural zones in Bangladesh, and the project will not only destroy productive farmland, but also cause the diversion of the Choto Jamuna River from its natural course. According to Professor Anu Muhammad in the Faculty of Economics at Jahangirnagar University, Bangladesh, studies in other countries have shown that rivers as far as 160km away from an open-pit mine can remain polluted for three decades as a result of the waste generated. He concludes that “in a country like Bangladesh, with hundreds of small rivers linked like a huge net, polluted water can travel long beyond the mining area.”[9] Despite these concerns, on 11 September 2005, the Bangladeshi Department of Environment approved the Environmental Impact Assessment Report prepared by the Asia Energy Corporation and granted environmental clearance for the mining operation.[10]

In order to gain the consent for the project from local communities, Asia Energy reportedly distributed colour televisions, cash, cloths and blankets to affected populations.[11] Furthermore, Asia Energy also reportedly refused to be bound by the 1894 Land Acquisition Act which regulates land acquisition and/or expropriation by the Government, and demanded the adoption of special laws in order to avoid the obligation to obtain the free, prior and informed consent of the affected communities.[12]

On 31 August 2006, five days after large and violent demonstrations against the Phulbari project, the Junior Minister for Food and Relief declared that the Government had revoked all existing agreements with Asia Energy and that a moratorium had been imposed on all open-pit mining in Bangladesh. On the same day, Asia Energy declared that it had received no official communication to that effect, and that the position of the Government remained to be clarified.[13] In practice, coal mining remains an important element in Bangladesh’s development strategy: on 17 November 2007, the Coal Policy Review Committee adopted a proposal encouraging partnerships between the Government and foreign firms engaged in mining in order to promote investment in and develop of the coal sector. The Committee also suggested strengthening the existing Bureau of Mineral Development so that it could deal more efficiently with foreign companies in leasing transactions and indicated its intention to establish coal-based power plants in rural areas.[14]

Local resistance to the project and violence against protesters

“What will happen to us if we are forced to move from here? What will happen to our livelihoods? I don’t want us to live like this. Our mosques and holy places and the places we were born will be destroyed. What will happen to the graveyards of our ancestors?”

75-year-old man, resident of Phulbari sub-district[15]

Resistance to the proposed Phulbari project is widespread in the areas. On 26 August 2006, an estimated 50 to 100,000 demonstrators, mainly farmers and indigenous people, protested against the project.[16] At least five demonstrators were killed and about fifty others reportedly injured and taken to hospital after the police and the Bangladesh Rifles (BDR) opened fire on demonstrators.[17] The exact death toll as a result of the shooting remains unclear, and may be as many as ten - it was reported that the BDR dumped some of the dead bodies.[18] Furthermore, the Bangaldeshi Daily Star newspaper reported that, according to eye-witnesses, BDR personnel threatened Magistrate Abdul Aziz with a gun in order to make him sign the authorization to open fire on the protesters.[19] Neither the Government nor the Asia Energy Corporation have taken any responsibility for these events.

Under the Emergency Rule declared by Bangladesh’s military government in January 2007, fundamental civil rights have been suspended and public protest banned.[20] These Emergency Rules effectively remove the possibility of the populations affected by the Phulbari mine engaging in peaceful protest, and OMCT expresses its strong concern that, should such protest nevertheless take place, they will be met with further and possibly more extreme violence on the part of the police and security forces.

Despite the violent suppression of public protest, resistance to the project remains high. On 15 December 2007, representatives of the sub-districts of Phulbari and neighbouring Birampur, Nababganj and Parbatipur wrote to the president and executive Directors of the Asian Development Bank expressing their concern that the project will “increase the poverty of the local population as well as cause environmental disaster”.[21] In this letter they claim that the social impact analysis carried out misrepresented the nature of public consultations around the project and that consultations emphasised the potential benefits of the project while failing to provide information on the negative impact. Furthermore, the community representatives express concern that only minimal information was provided in Bengali regarding the environmental impact of the project and that, to their knowledge, the environmental impact assessment has been neither translated nor summarised in the local language. They also underline that other media must be employed to communicate with a population of which approximately 60 per cent is illiterate. Additionally, they express serious concerns that land compensation and resettlement plans are insufficient to meet the losses likely to be incurred by local populations as a result of the mine, and that Asia Energy/GMC’s claim that 50,000 persons will be directly affected (and hence entitled to compensation) is a significant underestimation.

Economic Social and Cultural Rights

Bangladesh acceded to the International Covenant on Economic, Social and Cultural Rights on 5 October 1998, and consequently the Government of Bangladesh has the duty to ensure the protection, promotion and enjoyment of these rights for all its citizens. The Phulbari mine project jeopardises the human rights of thousands of people due to the mass evictions and destruction of agricultural land it will require and to the pollution that will result from the extraction activities. In particular, OMCT is concerned that the mine will seriously compromise the rights to health and to an adequate standard of living (including access to housing, land, adequate food and clean water) of those affected.[22]

OMCT also wishes to underline the comments of the Special Rapporteur on the situation of human rights and fundamental freedoms of indigenous peoples, Rodolfo Stavenhagen, who has expressed his concerns that the resources of indigenous communities are being appropriated and utilised, without prior consent, by powerful economic consortia, and that this “is currently one of the most controversial issues involving indigenous people, the State, and private enterprises, and often also the international financial institutions.”[23] In addition, the recent UN Declaration on Indigenous Peoples’ Rights states that, “indigenous peoples shall not be forcibly removed from their lands or territories. No relocation shall take place without the free, prior and informed consent of the indigenous peoples concerned and after agreement on just and fair compensation and, where possible, with the option of return.”[24]

The role of financial investors

According to the information received, UBS, RAB Capital and Barclays financial institutions all have an interest in GCM, the sole owner of the Asia Energy Corporation and the Phulbari Coal Project. In particular, UBS is the second largest listed shareholder, owning 11.39% of GCM.[25]

OMCT regrets the lack of transparency demonstrated by UBS in responding to civil society queries regarding its involvement in the Phulbari project. In response to questions on its position, the Bank denied that it had any strategic interest in the company and, noting that “it does not comment on potential or specific client relations or transactions or its investments in any particular company” indicated that its purchase of GCM shares “may or may not” have been carried out on behalf of a third party or parties.[26] OMCT calls upon UBS, as a leading financial institution operating in the global market, to lead by example in establishing a more transparent system of accountability, assessing the human rights and environmental impact of potential investments and assuming responsibility for investments in activities that breach international law and violate human rights.

Requested actions

Please write to the Government of Bangladesh asking it to:

• Instigate a thorough independent investigation into the human and environmental impact of the Phulbari coal mine project, ensuring the full and informed participation of all local communities. Make the findings of this investigation available in a public report (including appropriate language versions) and abide by the recommendations of this report. Request assistance from the UN Office of the High Commissioner for Human Rights to help ensure that the investigation is in conformity with international standards.
• Impose a moratorium on any other open-pit mining in Bangladesh, as initially announced on 31 August 2006, until the full impact on human rights and the environment of this activity has been assessed.
• Fully respect international human rights standards in any subsequent mining activity at Phulbari or elsewhere. This includes engaging in meaningful prior consultation with affected populations, ensuring that they are fully informed of the project proposals and their own rights in this regard, and providing fair and adequate compensation for loss of land, housing or livelihood where displacement is unavoidable. Ensure in all such cases an adequate and appropriate resettlement programme.
• Ensure that the proposed coal policy review strictly adheres to international human rights standards and to international principles relating to forced evictions and indigenous peoples.
• Lift the restrictions on public demonstrations imposed under emergency rule and take all necessary steps to prevent future episodes of violence by police and security forces against persons defending their human rights.

Please write to GCM Resources Plc asking it to:

• Suspend activities in Phulbari until a thorough, independent and fully-consultative investigation into the proposed project’s human and environmental impact has been conducted and abide by the recommendations resulting from this investigation.
• Fully respect the land rights, resources and livelihood of all local communities affected by any subsequent mining activity, and provide fair and adequate compensation wherever appropriate. 
• Take all necessary measures to minimise the environmental impact of mining activities and avoid the pollution of watercourses.
• Comply fully with national laws and international human rights standards in all aspects of its activities, in particular as regards the adverse effects of these activities on indigenous and local communities. Only carry out operations subsequent to a full human rights impact assessment, and having fulfilled, inter alia, the legal requirement to engage in meaningful prior consultation with persons affected.

Please write to UBS, RAB Capital and Barclays asking them to:

• Call for a thorough independent investigation into the human and environmental impact of the Phulbari coal mine project with the meaningful input of local communities.
• Use their financial influence in Global Coal Management Resources Plc. to ensure that the company abides by the recommendations issuing from the independent investigation and to make certain that it complies fully with national laws and international human rights standards.
• Carefully evaluate the impact of their current investments on the enjoyment of human rights around the world, and include a clear human rights impact assessment in future investment decisions.
• Promote greater transparency in their financial transactions. 

Please write to the Asian Development Bank asking it to:

• Recognise the discontent of the majority of the local population at the manner in which the preparatory phases of the Phulbari project have been conducted and insist on the production of a comprehensive human rights and environmental impact study with the full and informed participation of all local communities as a fundamental condition for financial support. Continue to monitor the human rights situation in Phulbari and surrounding sub-districts should the project be approved.

OMCT also asks the UN Special Rapporteur on the human rights and fundamental freedoms of indigenous people, the UN Special Representative on the issue of human rights and transnational corporations and other business enterprises, and the UN Special Rapporteur on adequate housing to monitor closely developments as regards the Phulbari coal mine project.

Click for list of addresses.

Information on action taken and follow-up

OMCT would appreciate receiving information on any action taken in relation to the matters dealt with in this Action File so that it might be shared with OMCT’s network and others interested in this issue. Please quote the code of this appeal on the cover page in contacting us. ***

Geneva, 21 December, 2007

W o r l d    O r g a n i s a t i o n    A g a i n s t    T o r t u r e

P.O. Box 21 - 1211 Geneva 8, Switzerland

Tel.: 0041/22 809 49 39 / Fax: 0041/22 809 49 29

E-mail: omct@omct.org / Web: www.omct.org

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[1] Thanks to BanglaPraxis for support in preparing this appeal.

[2] Asian Indigenous and Tribal Peoples Network, http://www.aitpn.org/IRQ/vol-I/issues-2-3/story01.htm#_ftnref4

[3]BBC News: Bangladesh coal divides region, http://news.bbc.co.uk/2/hi/business/5080386.stm

[4] See Asian Development Bank – Projects, http://www.adb.org/Documents/PIDs/39933014.asp

[5] Open-pit mines are also known as opencast mines. Both terms refer to the extraction of rocks or minerals by excavating earth to create pits rather than sinking shafts and digging tunnels.

[6] The Daily Star: Rehabilitation issue makes it a tough task, http://www.thedailystar.net/2006/08/29/d6082901159.htm

[7] the Arabic term for “schools”.

[8]The Daily Star: Rehabilitation issue makes it a tough task, http://www.thedailystar.net/2006/08/29/d6082901159.htm

[9] BBC News: Bangladesh coal divides region, http://news.bbc.co.uk/2/hi/business/5080386.stm

[10] Asian Indigenous and Tribal Peoples Network, http://www.aitpn.org/IRQ/vol-I/issues-2-3/story01.htm#_ftnref4

[11]The Daily Star: Cancellation of Phulbari Coal Project demanded, http://www.thedailystar.net/2006/08/24/d608241004111.htm

[12] Asian Indigenous and Tribal Peoples Network, http://www.aitpn.org/IRQ/vol-I/issues-2-3/story01.htm#_ftnref6

[13] Asian Indigenous and Tribal Peoples Network, http://www.aitpn.org/IRQ/vol-I/issues-2-3/story01.htm#_ftnref4

[14]Government Prime Role Recommended in Coal Mining: http://phulbariresistance.blogspot.com/2007/11/govts-prime-role-recommended-in-coal.html

[15] BBC News: Bangladesh coal divides region,  http://news.bbc.co.uk/2/hi/business/5080386.stm

[16]Bangladesh News - Phulbari Coalmine Killing, 28 August 2006, http://www.bangladeshnews.com.bd/2006/08/28/phulbari-coalmine-killing-thousands-defy-ban-stage-protest/ 

[17]The people were identified as: Tariqul Islam (24 years-old), Ahsan Habib (35), Osman (24), Raju ( and Chunnu. Asian Indigenous and Tribal Peoples Network, http://www.aitpn.org/IRQ/vol-I/issues-2-3/story01.htm#_ftnref4

[18]Bangladesh News: Phulbari Coalmine Killing, 28 August 2006 http://www.bangladeshnews.com.bd/2006/08/28/phulbari-coalmine-killing-thousands-defy-ban-stage-protest/

[19]The Daily Star: Magistrate forced to give firing order, http://www.thedailystar.net/2006/08/30/d6083001107.htm

[20] http://jurist.law.pitt.edu/paperchase/2007/01/bangladesh-media-restrictions-under.php

[21] see “Phulbari communities write to ADB President and Executive Directors”, http://banglapraxis.wordpress.com/2007/12/19/phulbari-communities-write-to-adb-president-and-executive-directors/

[22]  The Basic Principles and Guidelines on Development-based Evictions and Displacement prepared by the Special Rapporteur on adequate housing clearly define forced evictions as a violation of human rights, Basic principles and guidelines on development-based evictions and displacement, A/HRC/4/18 5 February 2007

[23] A/HRC/4/32, 27 February 2007

http://daccessdds.un.org/doc/UNDOC/GEN/G07/110/99/PDF/G0711099.pdf?OpenElement 

[24] UN Declaration on the Rights of Indigenous Peoples - Article 10, http://daccessdds.un.org/doc/UNDOC/GEN/N06/512/07/PDF/N0651207.pdf?OpenElement

[25] as of 15 November, 2007

[26] see http://www.banktrack.org/index.php?show=news&id=138