Granite mining hits rock bottom
State-owned rock producer Maddhapara Granite Mining Company Ltd (MGMCL) could not resume granite production for more than three months. The reason is a crisis of explosives, leaving the government to incur a production loss worth around Tk 1 crore per day.
The production of the country's lone mining company in Dinajpur's Parbatipur upazila was suspended on May 1 as the stock of ammonium nitrate explosives -- which is required to crush stones in the mine -- ran out.
MGMCL officials said they are still uncertain about when a fresh stock of explosives would arrive from India for production to resume.
This is the second instance of granite production being halted due to the explosives crisis this year, after a suspension between March 12 and 27.
MGMCL contributes six percent of the country's annual granite demand of 1.5 crore tonnes. According to the monthly sales data, MGMCL produced and sold 1.18 lakh tonnes of granite worth Tk 29.90 crore in April this year.
If they [MGMCL] initiated the importing process on time, the ongoing situation might have been avoided.
The quality rocks from the mine are widely used in private and public construction works, including in mega projects like Rooppur Nuclear Power Plant, Matarbari Plant and Hazrat Shahjalal Airport's third terminal, according to the granite dealers of the government facility.
The suspension of production will increase granite imports, they feared, adding that it would put additional pressure on foreign reserves at a time when the government is trying to discourage imports as part of austerity measures.
"Many companies are demanding for the mine's rocks. But we are turning them down as production remains suspended," Jugal Chandra Datta, one of the listed 67 MGMCL dealers, told this correspondent.
"We are losing our buyers as they find alternative sources of rocks from India. A large amount of foreign currency is being used for importing the rocks," he said.
The suspension of production also left around 650 local miners jobless. The company employs around 800 workers on a no-work-no-pay basis.
MGMCL officials said they could not bring a fresh stock of explosives for various reasons like vessel crisis, price hike of explosives in the international market and high transport costs.
Besides, a complaint from Germania Trest Consortium (GTC) -- the contracted company of MGMCL for the mine's development, maintenance and production -- about the low quality of explosives in December last year is also one of the key reasons that stalled the decision to import, said sources in MGMCL.
Energy and mining experts said the long closure of production due to the crisis of explosives only exposed the poor planning of a state-own company, which has proved to be a losing concern.
Energy expert Prof Badrul Imam said since explosives are the lifeline for granite production, the mining authorities should have formulated a proper plan to import explosives.
"If they initiated the importing process on time, the ongoing situation might have been avoided," he said, adding that the government should step in immediately to expedite the import of explosives from India.
IMPORT IN LIMBO
The process of importing a fresh stock of explosives started in December last year, according to an MGMCL official.
"An LC [letter of credit] for importing the explosives was opened early this year but was cancelled due to GTC's objection. Production would not have been hampered if the consignment could be imported," said the official, requesting anonymity.
In early May this year, MGMCL tasked GTC to import the explosives. A shipment of explosives usually takes more than two months after the order is placed, said the official.
The facility needs around 1.5 tonnes of explosives every day to keep production running.
Contacted, Mir Pinak Iqbal, MGMCL general manager (production), said production would resume after receiving the explosives.
"We are expecting a supply of explosives from India. However, the time of its arrival is still uncertain," he told this correspondent.
He said that as of August 24 they were yet to get permission from the Indian government to import the explosives.
Zabed Siddiqui, chief executive of GTC, refused to make any comment about the production suspension and its involvement in the import of explosives.
This correspondent could not contact MGMCL managing director Abu Daud Muhammad Fariduzzaman despite repeated attempts.
Nazmul Ahsan, chairman of Petrobangla, said, "Whether explosives will be imported is yet to be confirmed due to the present global situation."
He also confirmed that MGMCL has tasked GTC to import the explosives but did not elaborate on the matter.
MINERS FACING TOUGH TIMES
As production remained suspended for over three months, around 650 miners are facing financial hardship.
They said their misery has been compounded following the exorbitant price hike of essentials.
Among the 800 miners, around 650 were sent to forced leave from April 30, an MGMCL miner told this correspondent.
"I'm struggling to make ends meet for my family. I've already exhausted my savings and have taken loans. I'm not sure for how long we have to suffer," said a local miner, seeking anonymity fearing reprisal from the mining company.
He said around 150 miners are still working as part of the necessary maintenance of the mine.
A LOSING CONCERN
The state-owned company has incurred an operating loss of Tk 565 crore since it began commercial production in 2007, according to the latest report of MGMCL.
It has been a losing concern for 11 consecutive years before recording a profit of Tk 33.52 crore in 2018-19 and 2019-20 combined.
However, officials fear a considerable loss again due to the long suspension of production.
The mine, developed by a North-Korean company at a cost of Tk 1,275 crore, has been incurring losses as it has failed to meet the daily production target of 5,500 tonnes.
MGMCL hired GTC in 2013. After taking over charge of the mine on February 20, 2014, GTC produced around 3.75 million tonnes of rocks in six years, far below the given target of 9.2 million tonnes of those years.
GTC produced 8.23 and 10.17 lakh tonnes of granite in 2019-20 and 2020-21 fiscal, respectively.
Around 7 million tonnes of granite have been extracted so far from the mine, which had a reserve of around 174 million tonnes.
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