Three bids for Bangladesh project near Sundarbans

Three bidders have submitted proposals along with financing to construct the 1,320 megawatt coal power plant in Rampal close to the Sundarbans.

Japanese and Indian consortium Marubeni and Larsen & Toubro have brought in financing from Japan Bank for International Cooperation. Another Chinese consortium of Chinese Harbin, Alstom China and Etern have brought in Chinese government financing and Indian Bhel brought in Indian Exim financing.

“All three bids are fully finance backed,” said Uzzal Bhattacharya, Deputy Managing Director of the Bangladesh-India Friendship company that is implementing the Rampal project. The company has been formed with equal stakes of Bangladesh Power Development Board (BPDB) and India's National Thermal Power Corporation (NTPC).

There had been some doubts about whether the coal power project would at all get financing considering public criticism about the project's proximity to the Sundarbans World Heritage Site. This doubt was further reinforced when international media reported that three French banks have said they will not invest in the Rampal power plant, while two Norwegian Pension Funds pulled out their investments from NTPC.

“This project has no problem,” Bhattacharya told The Daily Star.

BPDB sources said the three bidders submitted proposals on September 22. The authorities are evaluating the bids now and the contract for construction would be awarded to the best bidder by January.

This engineering procurement contract was expected to be awarded by early 2014 with the target to begin commercial power generation from 2017. But in the face of environmental concerns, the authorities took extra time to refine tender guidelines and requirements. The project would now be delayed by two years.

It was initially estimated that the project would need US $ 1.7 billion investment --30 percent of which would come from the friendship power company while the rest from single or multiple international financiers. The actual investment estimate will be available after the best bidder is selected.

Located 14-kilometre northwest of the Sundarbans and four kilometres from the declared ecologically critical area (ECA), the selection of the Rampal site for a coal power plant drew a lot of criticism from the public. 

While the government keeps on defending the plant, saying its emission would not harm the forest, most critics believe that the disaster would take place while transporting coal to the plant site through the rivers inside the Sundarbans.

The plant will need 3.2 million tonnes of coal a year. Imported coal on 80,000-tonne capacity ships will anchor at the Akram Point. From there, lighter ships will load coal containers with maximum 10,000-tonne capacity and transport them to the power plant's jetty on the Passur. In other words, several smaller vessels carrying coal will ply the river every day, all the year round.

The project includes residential and social facilities, water treatment plant, sub-station, jetty, coal handling system and coal silo, ash handling and disposal facilities, and switchyard, including substation.

The project area spreads over 1834 acres of land, all of which have been acquired.

As per a government decision, for every kilowatt power sales from this plant, the Rampal locality will get Tk 0.03. This roughly totals Tk 27 crore or more a year. This fund will be used for building roads, hospitals and other infrastructure in Rampal.