Home ›› 08 Apr 2023 ›› Front
The long-discussed development of the Dighipara coal mine in Dinajpur will cost around $1 billion.
After 7-8 years of development, it will be possible to extract only 10 per cent of reserved coal in the next 30 years. The price of the extracted coal will be around $11 billion (at $176 per tonne), according to the findings of the Feasibility Study Review of Barapukuria Coal Mining Company Limited (BCMCL), responsible in the development of the Dighipara coal mine.
Focal point officials of BCMCL confirmed the findings of the feasibility study to The Business Post.
Though the issue of developing the Dighipara mine has been under discussion for seven years, the project is yet to be approved. And BCMCL officials could not give a clear idea whether it would be approved at all.
They say that BCMCL does not have the investment required to develop the mine. That is why BCMCL wants to hire foreign contractors, like the Chinese consortium CMC, through international bidding.
But, prior to that, the project needs to be approved by the Executive Committee of the National Economic Council (ECNEC). For this reason, the BCMCL has prepared a presentation on the economic overview of Dighipara Coal Mine for Prime Minister Sheikh Hasina.
BCMCL General Manager Abu Taher Md Nur-Uz-Zaman Chowdhury said, "Everything depends on the PM’s decision."
At a recent programme in the capital, journalists questioned Prime Minister’s Energy Advisor Tawfiq-e-Elahi Chowdhury about the government’s stance on domestic coal mine development.
In reply, he said, “The government is not in favour of coal mines by wasting valuable arable land. However, the development of the Dighipara mine following the underground method is under consideration. The government will finalise the decision if only it seems profitable without harming the environment and agriculture.”
The Geological Survey of Bangladesh discovered the Dighipara coal mine in Nawabganj upazila in Dinajpur in 1995. It is the second largest coal mine in Bangladesh with around 7.06 million tonnes of coal reserves.
In 2016, Petrobangla appointed BCMCL for the development of the Dighipara coal mine. In 2017, BCMCL hired Germany-based MIBRAG Consulting International GmbH and FUGRO Consult GmbH and Runge Pincook Minaroo Limited of Australia for a detailed feasibility study on the Dighipara mine.
According to their feasibility study report published in 2020, coal is deposited on 12.8 square kilometres of land in Dighipara and the government can extract three million tonnes of coal from the mine every year. It is technically possible to extract 90 million tonnes of coal from the mine, sufficient for running a thermal power plant for 30-40 years.
The study said the highest calorific value of coal is 7067 and the average calorific value is 6,645. The content of sulphur in the coal is 0.85 per cent.
Coal prices high due to hired management
Currently, there are two mines in Bangladesh under Petrobangla, BCMCL and MGMCL in Dinajpur, and both are operated by private contractors.
Chinese company CMC has been engaged in the development of the Barapukuria coal mine and extracting coal from the mine since 2005.
Several officials of BCMCL said the price of coal extracted from the Barapukuria mine is high as the extraction is not conducted under BCMCL’s own management.
A BCMCL official, seeking anonymity, said BCMCL gets the coal from CMC at a price of $135 to $140 per tonne and sells it for $176 per tonne. In Indonesia or Australia, this cost is around $60 to $70.
“We do not have any technical industry or machinery. As a result, we have to hire foreign companies. However, domestic coal is more profitable and affordable than imported coal,” he added.
20 million tonnes coal needed annually
At present, there are seven coal-fired power plants with a capacity of around 7,000 MW in Bangladesh. Of these, four have come into production. These power plants have been built depending on imported coal, except the Barapukuria thermal power plant.
Bangladesh Power Development Board (BPDB) sources said around 20 million tonnes of coal will be required annually once all these power plants start production. However, the government is already struggling to maintain fuel supply due to rising coal prices in the world market.
Apart from this, a 1600 MW power plant of India’s Adani Group, built for Bangladesh, will require about nine million tonnes of coal. The coal price is already being criticised as Adani Group is seeking $400 per tonne for low-quality coal.
The BPDB, however, did not accept the price and negotiations are going on to settle the issue. BPDB sources indicated that the price will reduce slightly.
BCMCL Managing Director Saiful Islam Sarkar said, “We are ready to start developing the Dighipara mine from where around three million tonnes of coal can be extracted annually. If the project on the mine is approved, it will be possible to meet the coal demand of our power plants domestically. It will reduce import pressure.”
