Draft coal policy finalised

Aminul Islam, NewAge, December 15, 2007. Dhaka, Bangladesh

The advisory committee to finalise the draft coal policy completed Friday the review of the draft and is set to submit it to the government.‘We have finalised the draft coal policy protecting the national interests. We are now ready to submit the draft any time when the government gives us a schedule,’ the committee convenor, former vice-chancellor of the BUET Abdul Matin Patwari, told newsmen after the final review meeting at Petrobangla.The draft policy discourages coal export with the present coal and gas reserves. It recommends awarding coal exploration and development licence to a state-run entity that can go for joint venture with local private-sector and foreign companies through competitive bidding, mandatory installation of power plants at mine mouths, setting up an open-pit coal mine as a test case, and forming a coal sector development committee to set the royalty rate on extracted coal time to time.‘Many people have an apprehension that our coal resources will be looted. We hope the draft coal policy will dispel such apprehensions. After lots of debate, difference of opinion, and hectic meetings, we have successfully completed a draft which we feel should be acceptable to all,’ Abdul Matin said.The daft policy mentions that, as per the current estimate, the proven coal reserve in the country’s four fields is around 884 million tonnes, whereas the demand for coal for power generation is around 450 million tonnes till 2025, 825 million tonnes till 2030, and 1,200 million tonnes till 2035.It says, ‘Even if open-pit mining method is applied in case of shallow coal reserves like Barapukuria and Phulbari and underground mining method is applied in medium depth coal reserves like Khalashpir and Dighipara, the total amount of coal that can be extracted is 660 million tonnes.’Besides, given the current reserve of gas, the country is set to face gas shortage after 2011.‘In these contexts, there is no scope of coal export from Bangladesh with the current reserve of coal and gas and as the annual rate of coal extraction will be enough only to demand the country’s demand for coals,’ the policy points out.It, however, says that if the country discovers new gas and coal fields in future, the government can make a decision on coal export after considering the demand and supply scenario of coal and after ensuring the country’s energy security for 50 years based on the recommendations of the proposed 28-member coal sector development committee.In case coking coal is found, the policy keeps a provision of exporting coke, a finished product of coking coal, a high grade coal compared to the usual steam coal.The policy says the north-west region of the country will be declared a coal zone to facilitate its long-term development.It says a holding company titled ‘Coal Bangla’ will be formed. Along with Coal Bangla, other government entities like Petrobangla will also get coal field exploration and development licences.The policy says at first one open-pit mine will be developed at a shallow depth coal field like Barapukuria’s north field to gather hands-on experience and to assess its impacts on the environment. ‘If the result of the open-pit mining method is satisfactory, it can be used in other coal fields for commercial extraction.’It, however, says, ‘Although the geological condition, financial and technological issues and the overall energy security will get preference in use of open-pit mining method, opinions of the local committees comprising elected local government representatives and social groups will have to be taken into consideration.’Regarding the underground mining method, it says necessary measures will have to be taken based on the experience of Barapukuria. The policy says the lessee of a coal field will have to rehabilitate the inhabitants of the area before commencing mining, pay proper compensation to them, reclaim the land used for coal mining and give back the land to the former owners after completion of mining activities.The policy says that the lessee will have to install a power plant of at least 500MW capacity at the mine mouth for extraction of every 3 million tonnes of coal and have to bring the plant into operation within six month into beginning of coal production.The policy says the coal price will be 70 per cent of that on the international market.The coal sector development committee, headed by the power and energy minister and comprised of parliamentary members, secretaries of different ministries, a major general of the army, professors of universities, experts and private-sector representatives, will set the royalty rate time to time considering the cost of coal production, international coal price, electricity generation cost, and the government’s neat income.The policy has set the royalty rate of coking coal at 30 per cent of the price of steam coal on the global market.Professor Nurul Islam of the BUET, Professor Badrul Imam of Dhaka University, Bangladesh Army engineer-in-chief Major General Ismail Faruque Chowdhury, Centre for Policy Dialogue executive director Mustafizur Rahman, Petrobangla director Maqbul-E-Elahi, and IIFC executive director Nazrul Islam were also present at the Friday meeting of the draft finalisation committee.


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