Country set to enter mining era

Seen on an aerial photograph, Barapukuria Coal Mine Project, the first in Bangladesh, looks set to go into commercial operation in October. PHOTO: STAR

Against many odds, the first two mines in the country are coming into commercial operation in October, opening up two new sectors -- coal energy and granite production.

The North Korean built Maddhyapara Hard Rock project and Chinese built Barapukuria Coal Mine project of Petrobangla will also employ thousands of people directly in the industrially backward northern region.

"Both these projects saw many hurdles. But both of them have now come to a final shape with more than 80 percent work completed," said a top official of Petrobangla. "We can now confidently say they will come into operation in October if nothing unusual happens."

The impact of operation of the Tk 1431-crore coal mine project will not be felt immediately as its main consumer -- the 250 megawatt Barapukuria Power Plant-- will start operation several months after the mine is ready for commercial production.

The mine has 64 million tonnes of high quality coal, which in terms of thermal value is equivalent to 17 trillion cubic feet of gas. Given the present trend of energy consumption and gas crisis, the mine will become the biggest alternative source of energy in the country.

But there will be an immediate impact of the Tk 1024-crore hard rock mine project that is already extracting granite and selling it to selected consumers.

Three years behind the schedule for its operation and still going through some glitches, the project is all set to start commercial sales of 1.6 million tonnes of granite a year from October.

The project will sharply reduce dependence on hard rock import, as it will produce 1.6 million tonnes of granite against an annual demand for 3.4 million tonnes. This will save between $38 million and $58 million a year although the granite will not be cheaper than the rocks usually imported from India.

"This is because the project is costly and slow implementation has made it costlier," said a Petrobangla source. "But, still it will be a profitable venture."

As per the original deal, the project's North Korean contractor Namnam and its Polish consultant Kopex were supposed to complete the turn-key project in 2001.

But financial crunch of Namnam stalled the progress of work for many months. When the project restarted by extending the contract with Namnam, its cost increased to Tk 1024 crore from Tk 894 crore.

"The project has been suffering due to absence of a consultant for the last one year," said the Petrobangla source. "Petrobangla experts are doing the consultant's job, but we really need the help from the original consultant."

Although the agreement with Kopex was extended through a supplementary contract in March last year, it had to wait for clearance by the cabinet.

Clearance will be given in a week or so, Petrobangla sources said.

Till January this year, Namnam extracted over 3,00,000 tonnes of granite, of which Petrobangla sold over 1,75,000 tonnes to different consumers. Till then 80 percent of the project was completed.

Officials of the project and Petrobangla said the project faced a lot of opposition from the hard rock importers' lobby, as the mine is threatening their 'ways of business'.

The coal project also saw various hurdles and even some major disasters. Several workers were killed in disasters inside the mine while sub-soil water reservoir leakage repeatedly flooded the mine, allegedly designed badly.

Besides, delayed appointment of consultant has pushed the schedule of the $220 million coal-fired Barapukuria Power Plant Project. This plant will consume 70 percent of the one million tonnes of coal to be produced annually. The rest will be sold to general consumers and exported.

The power plant is costlier by at least $70 million than other plants of the same capacity.

Built by Chinese company CMEC, 83 percent of the coal project was completed by February this year and by that time 62,574 tonnes of coal were extracted.

The Cabinet Purchase Committee approved Monday appointment of another Chinese company Shandong Ludi Consortium for production, management and maintenance of the Barapukuria Coal Mine at a cost of 49 million dollars. Shandong will take over the mine's responsibility from October.