Global Coal Management Plc (formerly Asia Energy PLC)



Overview

GCM Resources plc (GCM) is a London-based resource exploration and development company. Its principal asset is its undeveloped coal deposit in the Phulbari region of Bangladesh, the development of which is awaiting approval from the Government of Bangladesh. It also has investments in other companies with mining interests. The company's shares are quoted on the Alternative Investment Market (AIM). (Ticker code: GCM).

The Phulbari Coal Project is a substantial, world class coal resource that will support a long life, low cost mining operation. It is the only such deposit in Bangladesh that has been subjected to a full Feasibility Study and Environmental and Social Impact Assessment prepared to international standards. In partnership with the Bangladesh Government, civil society and the community, GCM is committed to developing the Phulbari Coal Project to the highest social and environmental standards. By doing this, GCM seeks to maximise the benefits of the Project for both the Company’s shareholders and the people of Bangladesh.

The Company (GCM) under its former name, Asia Energy PLC, was incorporated in England and Wales as a public limited company on 26 September 2003. Asia Energy PLC was admitted to the Alternative Investment Market (AIM) of the London Stock Exchange on 19 April 2004. Through seed capital raising and the subsequent placement of shares, some £14 million was raised.

In November 2005, following submission to the Government of Bangladesh of the Phulbari Coal Project's Feasibility Study and Scheme of Development, the Company placed an additional 7 million shares and raised a further £33 million.

GCM actively reviews investment opportunities in order to broaden its global investment portfolio.

Coal Project facts

■ Energy security and diversity – The Project has a unique role to play in addressing the country’s electricity shortfall as its development will provide the basis for a step change in the country’s electricity generating capacity.
■Regional development – The Project will provide 17,000 jobs (direct and indirect). In addition the development of new industries using the industrial mineral co-products from the mine will create thousands of more jobs. The living conditions of all affected people will be improved and their livelihoods will be restored and in many cases improved. As a result of year round irrigation, improved water quality, improved inputs and improved farming practices it will be possible to produce three crops per year with higher yields than at present.
■Huge economic impact – Phulbari will contribute 1% to Bangladesh’s GDP each year and pay US$7.0 billion in taxes, royalties and service charges to the Government over the life of the Project. The replacement of high sulphur imported coals and other hydrocarbons will have a positive effect on balance of payments and air quality.

In partnership with the Bangladesh Government, civil society and the community, GCM is committed to developing the Phulbari Coal Project to the highest national and international social and environmental standards. By doing this, GCM seeks to maximise the benefits of the Project for both the company’s shareholders and the people of Bangladesh.

Background

Bangladesh is one of the most densely populated countries in the world with some 162 million people living in an area two thirds the size of the United Kingdom or about the size of New York State. Less than one third of its population live in cities while the majority live in rural areas relying on a predominantly subsistence lifestyle. GDP per capita is around US$1,700 (ppp) per annum compared with a world average of US$10,500. Less than half the population have access to electricity. Bangladesh is a country of enormous potential. It has the eighth largest work force in the world and is included in the “Next Eleven” countries that, after the BRICs (Brazil, Russia, India, and China), were identified by Goldman Sachs as having the potential to become the world’s largest economies in the 21st century. It has enjoyed more than 6% economic growth in real terms over the last five years as well as substantial improvements in measures of human development. For example, between 1980 and 2006 life expectancy has improved from 48 years to 63 years and literacy rates have improved from 29% to 53%.

Bangladesh is one of the most climate vulnerable countries in the world with a significant proportion of the population living in remote or ecologically fragile areas such as river islands or cyclone prone coastal areas. Two thirds of the country is less than five metres above sea level making it vulnerable to the predicted effects of climate change.

Although Bangladesh is vulnerable to the effects of climate change, it is not itself a significant emitter of carbon dioxide. Per capita carbon dioxide emissions (0.3t/capita) are substantially below other countries in the region (Pakistan 0.9t/capita, India 1.4t/capita, China 4.9t/capita) which themselves are substantially less than emissions from developed countries (UK 8.9t/capita, USA 18.9t/capita). Even with the addition of the 4,000MW of electricity capacity which Phulbari coal could support, Bangladesh would still be one of the lowest emitters of carbon dioxide in the world, substantially less per capita than its neighbouring countries.


http://www.gcmplc.com/

"

BEIJING (XFN-ASIA) - China's coal demand is expected to rise 6 to 8 pct next
year, driven by its robust economy and expanded power generation, the China Coal
Industry Association said.
The association said China will be a net coal importer through most of 2008.
This is mainly due to high demand from power plants in China's eastern and
southern provinces.
Supplies of coking coal, which is used by steel companies, are also expected
to tighten in 2008, leading to price rises of 15 to 20 pct, it said.
kelly.zang@xfn.com

at last up we go !! positive vibes from AGM ! From what I hear negotiations are progrssing well and are rational and should lead to an agreement in the next few weeks on the coal policy

By- Khondkar Abdus Saleque 07/12/2007

Bangladesh has a Twenty- Twenty vision for supplying power to its entire citizen. The vision was adopted in 2000. 7 years have elapsed since then. In end 2007 the official figure will show Bangladesh has achieved power supply to about 35%.But if you seriously audit it may not be more than 30% who have access to quality electricity. Mere extending power distribution network and connecting consumers mean nothing unless uninterrupted power at stable voltage can be ensured.4-6 hours load shedding of connected consumers do not mean we have achieved any mentionable target as yet.



If we seriously analyze the system we have to audit our generation, transmission, distribution system or in fact all segment of power sector. Assured fuel supply, choice of fuel and their availability will form a significant part of the discussion. This very important issue of national life was recently discussed in a roundtable conference held in Dhaka moderated by the Editor of a leading English Daily. For the sake of discussion some reference can be drawn from the discussion of the seminar.



Our present effective power generation capacity is about 4000MW per day against a suppressed demand of 5200MW. Our dilapidated power transmission and distribution system can not handle more. There is about 1200MW captive power generation capacity much of which remain unutilized. Many of the generation units at Ashuganj, Ghorashal, Siddhirganj, and Shikalbaha have long outlived their effective economic life. In many countries of the world these plants would have been retired long time back and replaced with modern fuel efficient plants. But it did not happen for us. We spent millions in necessary or sometimes unnecessary repair, maintenance and overhauling .These have now become essential nuisance. If these run for few weeks these remain inoperative rest of the time. So these are mostly unreliable. So it is not wise to count these when making plan for future. Power sector master plan identified several power plants for priority implementation. But most of these did not take off for many reasons. It will not be out of place to discuss these reasons here.



It is not still clearly understood why power division and energy division were separated in MOEMR sometime during Awami League Government Rule from 1996-2001.The coordination between the two divisions fell apart since then. This among others is one of the main reasons for the current crisis. Natural Gas still accounts for more than 90% of our power generation and about 40% of our gas is utilized for power. But lack of coordination between power and energy divisions have resulted in situation when power load centers do not have required gas transmission facilities and future potential power plants locations require substantial gas transmission infrastructure. Moreover very ineffective and non professional gas sector management failed to address the critical issues of gas sector development in time to comfort the situation. Consequently substantial volume of gas remains stranded in the Sylhet region while power plants in Chittagong and Ghorashal areas are struggling for gas supply.



The constraints of power supply to Ghorashal are known to all. Luckily the Ghorashal Fertilizer factory is shut down now. This has allowed Ghorashal plant to get more gas from the grid. But the situation will again become critical when UFFG comes back into operation. To comfort Ghorashal Power hub a dedicated 20 OD pipeline may be built from Monohardi as soon as possible.



The situation of Chittagong will continue to remain critical till additional gas supply to Chitagong is ensured. The BGSL transmission system was developed in early eighties with a definite vision. The 24 OD Bakhrabad Chittagong Transmission pipeline at that time attracted lot of criticism from so called energy experts. This pipeline at MAOP of 960 PSIG was designed to transport 350 MMCFD. In 25 years since then Chittagong market has now grown to about this demand but system struggles to supply this gas. In the beginning Bakhrabad Gas field was thought to be lone supplier. 5 wells drilled initially were targeted to supply gas to South East Bangladesh including Chittagong.Later, Feni Gas field was included in the loop. The operation of Bakhrabad Gas field was very much injudicious at the early stages. No reservoir management philosophy was followed. Wells desigened for 20MMCFD were made to produce 30-35 MMCFD causing extensive damage to reservoir pay sand structure. Three more wells were drilled in the major pay sand J in very close location. These were all professional crimes of Petrobangla management ironically dominated by incompetent Geologists. Bakhrabad gas field could continue delivering about 100-120MMCFD even now if it was not made to flow at the rate of 190-200MCFD at some stages in 1989-90.Its not that experts did not warn the authority. Reservoir expert IKM made specific recommendations .Countrys own expert Late Quazi Shaidur Rahamn was very vocal. But everything was done to secure gas supply for KAFCO which signed a controversial gas supply contract with BGSL.The Bakhrabad Gas fields production disaster not only caused massive damage to reservoir and subsurface as well as surface facilities of the field but it also flooded the transmission pipelines from the field with condensate water and sludge. This required massive on stream pigging operation taking lot of risks. The gas supply constraints led to suspension of gas supply to major consumers in Chittagong in 1996-97 till Ashuganj- Bakhrabad Gas line was built and gas for Chittagong was made available from National gas Grid. Later on in late nineties Shangu offshore came on stream as a blessing for Chittagong area. But here again we did not learn lesson from Bakhrabad Disasater.The PSC operator of Shangu was allowed to produce at much higher rate causing damage to reservoir. Consequently the production sharply declined. The gas field which could produce @140MMCFD for many years were made to produce @180MMCFD.This has now led to a declined production of 65MMCFD and progressively going down. For this situation in Shangu it now requires additional gas diversion from national grid through Bakhrabad Gas field but the required augmentation works of additional gas diversion have not been done over the years. Fortunately the compressor station at Bakhrabad gas field is operational now otherwise matters could be still worse. The original design concept of BakhrabadChittagong pipeline provided for a compressor station at Feni to augment the capacity to 500MMCFD. This can still do that. But possibly the pipeline is seriously eroded and corroded by now due to transmission of wet and dirty gas from Bakhrabad gas field. The section from Feni to Chittagong may not support the increased velocity and pressure. This can only be checked with intelligent pigging .But best option would be to build a loop line from Feni to Chittagong along with pipeline compressor at Feni.The suction side may not be a problem .But eventually the loop should be extended to Bakhrabad or to Brahmanbaira.The present situation can not support any new gas based power plant in Chittagong area till gas supply is shorted out. The ongoing drilling operation at Magnama may bring some good news. But gas from this prospect may not be available before 2010 at the earliest. The other efforts at tiny Semutang and Begumganj may not bring much comfort. Additional gas supply from national grid will require compressor stations at Muchai and Ashuganj. These may not be on stream before 2011.Government is not much focused on gas from Myanmar at this stage it seems. Situation in Myanmar is not also supportive. Gas from deep water prospect is also a far cry.



People possibly do not have correct vision about our proven reserve running out too soon. They can not be blamed also. There is no reliable reservoir study information. All are educated guess. What is our proven reserve? You talk to three different experts .You will get three different figures. Even the major gas fields like Titas, Habiganj, Kaillastilla, and Bakhrabad did not have any serious reservoir studies. 3D seismic studies will only be carried out in near future. Can guarantee, our concept of our proven gas reserve will dramatically change following 3D seismic of major fields. So till such time we must not create panic. Our gas will not be running out so soon. But we must run our fields very professionally with right professionals. These are not everyones piece of cake.



Energy sector failed to reach gas to Khulna region despite having substantial demand and availability of gas in Shabajpoor gas field in the region. UNOCAL proposed to implement WRIP in 2000.The proposal included development of the field and construction of Shabajpoor to Dighalia Gas transmission pipeline and power plants in Bhola, Barishal and Khulna.UNOCAL proposal was not considered for approval. The author do not like to open that chapter.Bapez x was given responsibility to develop Shabazpoor.But unfortunately in 7 years since then we could not even set up a gas based power plant in Bhola. If this could be done the recent power crisis following the cyclone devastation could be avoided. One only hopes the ADB assisted GSDP project will be implemented soon and gas is transported to Greater Khulna Division as scheduled.



Now let us discuss other fuel options. Bangladesh is believed to have substantial coal reserve. But in several decades our only success in Barapukuria. Inappropriate mining method and poor management of mining has made this a near disaster. Hundreds of crores have been spent to recover a maximum of 10% of coal in place. No other mines are under exploitation now.Phulbari is potentially large mine .The coal is lying at a shallow depth. After extensive feasibility Asia Energy has proposed surface mining method. But our economist and environmentalist have agitated against surface mining and AEC.Their agitation triggered violence and suspended mining. Even CTG remains confused. The AEC proposal still hibernating. A high-powered committee having no mining expert is examining the draft coal mining policy for months. A poor country like Bangladesh having precious natural resources can not remain hostage to myths and unfounded apprehensions. We need to explore and exploit our natural resources in the most optimum method. The coal must be mined without further delay. It is sheer irony that our policy makers are contemplating import coal based power plant leaving substantial coal underground. Some people seems to have taken sole agency of patriotism .They do not listen to logic .They do not understand technology has advanced very far than the imagination of our so called experts. Our coal must be made available to set up coal based power plants to create diversity in fuel basket. About 4000MW coal based power in the next 10 years will lead us to power for all by 2020.It may be AEC or any other company but surface mining must be the mining method in case of shallow coal seams.



Generation alone will not solve problem. Bangladesh also needs substantial investment in power transmission and distribution segment. New power transmission grid is required to supplement and expand the existing grid. New transmission grid is required from Sylhet region where present stranded gas can support early power generation. If we have surplus coal based power plants in the next decade in the Western parts of Bangladesh we may need a second east west inter connector. If Government can not fund these PGCB may let out shares in local stock exchange to raise capital. Private sector may also be allowed to invest in power transmission. PGCB may still remain operator. Bangladesh must also aggressively interact with neighbors for setting up regional power grid. Our peak and off peak demand vary over large extent. We may trade power at off peak when we achieve surplus. But our priority must be directed to achieve self sufficiency.



We must come out of default culture. In developed country no one can escape without paying utility bills. For few defaulters mass suffer,. Strong public opinion must be created against energy defaulters National ID may be used to detect the defaulters. Massive drive against defaulters and energy thieves may improve system loss and accounts receivables .Business leaders must help the moves.



All the energy sector activities must be very transparent. The identified energy sector mafias must get exemplary punishment for polluting and corrupting the sector so that in future no one dares to indulge in corruption. Future governments must realize that access to power like Food, Shelter, and Medicare is the fundamental constitutional right of the people. Major political parties in their election agenda must declare clear vision of energy issues before election. BERC must be allowed to play its role for regulating energy business. Energy journalists must play its role without fear or favor of anybody. Bangladesh does not want mushroom growth of Khamba business like power mafias any more.



Bangladesh may not achieve the target of power for all by 2020.But there is no harm in having such target .Without target and vision nothing can be achieved. But we need a road map to achieve it. If we remain committed, fair and honest the target may be deferred a little bit say 2030 but whatever we do we must do with professional excellence and commitment. Only line professionals should be listened to in making decisions .Other so called academic experts must not get priority



Bangladesh economy will soon face serious crisis if the power situation is not sorted out. Our export commodities will loose competitive edge. Importers will loose confidence. Investors will loose incentive. Bangladesh will never be able to achieve the desired economic growth to alleviate poverty and will drift way from Millennium development goal.

Of Interest:

Coal prices to hike 10% next year
By Du Xiaoli (chinadaily.com.cn)
Updated: 2007-12-18 15:23


Key contracts of coal for electricity generation for delivery in 2008 have been signed and major prices increased by 30-40 yuan ($4.06-5.42) per ton, up around 10 percent year on year, according to China Coal Transport and Distribution Association, Shanghai Securities News reported.


The volume of key coal supply contracts reached 888 million tons as of 5:30 pm yesterday, including 628 million tons of coal for electricity generation.


The hike will drive up electricity prices in tandem, but the National Development and Reform Commission is reluctant to mention electricity price hikes due to concerns on exacerbating inflation.


Insiders attribute the price hikes to tighter coal supply, global crude oil price rises and costs.


Electricity firms often propose an electricity price increase when price of coal for electricity generation rises to pass the increased costs onto their consumers.


According to securities analysts, listed coal firms will have better financial results in 2008 because of the key contract price hike. The power industry may face larger cost pressures because it is still unknown whether the government will peg electricity prices to coal prices.


http://www.chinadaily.com.cn/bizchina/2007-12/18/content_6330079.htm

http://www.energybangla.com/article_det.asp?aId=854

Bangladesh Coal Policy – Ice has Melted

EB Report , published 20/12/2007





The more poignant parts:Too Long to post !

As a self respecting nation we desperately need well equipped Bangladeshi line professional to mange the mining activities and actively participate .But to do it in a meaningful way it will take at least 5-6 years to at least to organize our domestic capability. Till such time we must have to rely on foreign experts and ensure appropriate technology transfer.

Now the question arises can any contract signed between a sovereign government and an International contractor be terminated without any default of the contractor? What is the legal basis of any agreement between the mayor and the agitators? These were referred to the Ministry of Law by Energy Ministry. The opinion has been received.

"In such case if government terminates the contract the aggrieved party will obviously go to arbitration and there is no reason for Bangladesh to win the arbitration. .Bangladesh will have to account for HUGE compensation and its image in the international business world will be seriously dented. The situation is very tricky for Bangladesh government"

In modern mines water management and refusal handling are very scientifically done. The author has visited few underground and two surface mines here with some very experienced miners. The author is really amazed to see how professionally the activities are done here. Australian mining rules is very stringent. The environmental regulations are also pretty stringent .The occupational health and safety issues are also very meticulously followed.

And the icing on the cake!!

"For Bangladesh it is not possible to step out from a signed contract with any international contract unless the other party makes major default which can cause termination of the contract."

"Mr.Islam has also mentioned that the committee had no access to documents which could justify governments action for revision of royalty rate from 20% to 5 or 6%."

"Unless we plan setting up enough coal based industries to consume most of the coal domestically sooner or later Bangladesh will come under pressure to let export the coal."

Sunday, January 6, 2008 03:24 AM GMT+06:00

Metropolitan
Adopt habitat-friendly coal mining
Speakers call at discussion

Phulbari residents will not oppose coal mining in the area if their habitat and livelihoods remain unaffected said leaders of Phulbari Rakkha Committee yesterday.

"We shall have no objection if mining is done without affecting our habitat and livelihoods," said Khurshid Alam Moti, joint-convener of Phulbari Rakkha Committee, a body which is protesting open-pit mining at Phulbari in Dinajpur district.

"We urge the government to consider our expectations before taking any decision," he said.

Moti made the appeal after the screening of a documentary on Phulbari at a discussion in the city which was organised by the Society for Environment and Human Development (SEHD).

Former chief adviser of a caretaker government Justice Muhammad Habibur Rahman, Chief of Coal Policy Review Committee Prof Abul Matin Patwari, Advisory Editor of Amar Desh Ataus Samad, Prof Anu Muhammad of Jahangirnagar University and Prof Nurul Islam of Buet spoke on the occasion.

Prof Sakhawat Ali Khan, SEHD chairman and a teacher of mass communication and journalism department, chaired the programme.

"I don't think any government would be able to take any decision without considering the objections of people. I am sure the present or the next government will go forward considering the issue honestly," said Justice Rahman.

up 14% maybe things are on the move ??

coal policy submitted Smiler by advisory committee to Bangla govt....

Fingers crossed aj :)

you never know Smiler - though hard to decipher what is really going on....!

Reduce dependence on gas: Plan to develop coal sector
January 10, 2008, Updated: Bangladesh Time 12:00 AM

BSS, Dhaka

The draft Coal Policy review committee in its final report has recommended that use of natural gas in different sectors including power should be gradually lessened side by side with increasing the use of coal and other substitute fuel sources to ensure energy security in the country.

The report was yesterday handed over to the Secretary of the Ministry of Energy and Mineral Mohammad Mohsin, with a provision for forming a public sector organisation named "Coal Bangla" to develop the coal sector, an official handout said.

The Secretary received the report from committee chairman Professor Abdul Matin Patwary. The 10-member review committee, formed on June 21 last, finalised the report after reviewing the overall draft coal policy in as many as 19 sittings, it said.

The committee felt that ensuring energy security through the speedy development of the coal policy is its main objective, the handout said.

Professor Nazrul Islam, Maj. Gen. Mohammad Ismail Faruq Chowdhury, Professor Nurul Islam, Journalist Ataus Samad, Professor Mostafizur Rahman, Nazrul Islam, Mohammad Maqbul-e-Elahi and Mohammad Ehsanullah were present during the handing over of the report.

Officials of the Ministry of Energy and Mineral Resources were also present on the occasion.

http://www.thedailystar.net/story.php?nid=18738


NY conference to brand Bangladesh 'exciting investment' destination
Star Business Report

A major conference on investment opportunities in Bangladesh, organised by the Asia Society and sponsored by the financial services group JPMorgan, will be held in New York later this month with the country being described as “one of the world's most exciting investment opportunities.”

The conference titled 'Updated Investment Opportunities in Bangladesh' is being held at a time when foreign investment in the country's stock exchanges has been rising. In 2007 net foreign or portfolio investment on the Dhaka Stock Exchange surged 830 per cent to TK8.9 billion.

The conference, to be held on January 24 at the Asia Society and Museum in New York, is co-organised by Network of Young Bangladeshi American Professionals.

According to the invitation from the Asia Society, an organisation working to strengthen relationships and promote understanding among the people, leaders, and institutions of Asia and the United States, the Bangladesh economy has steadily accelerated in recent years, with growth reaching 7 percent in 2006.

The invite continues, "Despite the troubled political environment and extreme poverty, the country scores particularly well on socio-economic indicators. Global banks and multilateral institutions also present a highly optimistic outlook: Citi, Goldman Sachs, JPMorgan and Merrill Lynch have identified Bangladesh as a key investment opportunity. This impressive growth occurs in a climate of political restructuring."

The caretaker government is “implementing reforms toward privatising many state-owned enterprises. The Dhaka Stock Exchange Index is at a 10-year high, up 66 percent last year, making it Asia's top performer after China. And the stock market is expected to double in size in 2008.”

“Discover why market-oriented reforms, strong socio-economic indicators and highly favourable demographics are poised to render Bangladesh one of the world's most exciting investment opportunities, it says.

At the conference, David Fernandez, head of Asia Sovereign Research of JPMorgan, Iftakharul Islam, founder and managing partner of Asia Tiger Capital Partners, Ahsan Mansur, division chief, Middle East and Central Asia of International Monetary Fund, Nasim Manzur, chief executive officer of Apex Adelchi, Apex Enterprise, Munawar Misbah Moin, group director of Rahimafrooz (BD) Limited, Mamun Rashid, managing director of Citibank NA, Bangladesh, and Dominic Wilson, managing director, Global Economics Group of Goldman Sachs & Co are the invited speakers.

http://www.thedailystar.net/forum/2007/october/coal.htm

;)

nice tic up today !!

long may it continue smiler - rewards to the long term believers eh? Still be nice for something to firm up though.... but sp going in the right direction.

Tata, Asia Energy for sharp adoption of nat'l coal policy

M Azizur Rahman

The Indian business conglomerate - Tata Group - and the UK-based - Asia Energy - have cautiously welcomed submission of the report by the review committee on the national coal policy.

Both the foreign companies, keenly waiting to invest in the country's coal sector, have also underscored the necessity to immediately adopt the national coal policy and initiate its implementation.

The accumulated investment proposals of Tata and Asia Energy, now pending with the Board of Investment (BoI), is around US$ 5.5 billion and a significant portion of their investments are for coal mining in Bangladesh.

"As long as the policy is growth oriented and the benefits are derived by the nation it will be welcomed by all," the resident director of Tata Group in Bangladesh Manzer Hussain told the FE.

"We are waiting for long," Hussain said adding, "We are now looking for a government decision."

Tata submitted its latest investment proposal worth $ 3.0 billion to the BoI on April 30, 2006 to develop 6.0 million tonnes capacity open pit coal mine at Barapukuria of Dinajpur, install one 2.4 million tonnes per annum capacity steel plant at Pabna, and 1.0 million tonnes capacity urea fertiliser plant in Chittagong.

Regarding the committee report submitted to the energy secretary on January 8, 2008 the Tata Group's top official in Bangladesh, however, said that there is a similarity between Tata's proposal and the review committee's suggestion especially on the issue of joint venture and equity participation from the capital market.

"Tata in its investment proposal offered joint venture between Tata and state-owned Petrobangla to develop Barapukuria open cast coalmine," he said.

The review committee's recommendation also noted that the foreign companies, willing to develop the country's coalmining sector, must have to go for joint venture with a proposed state-owned entity Coal Bangla.

Besides, Tata also planned to raise a portion of its capital from the Bangladesh stock market, Manzer Hussain said.

"We are happy that the government at last got the review committee submitted," a senior Asia Energy official told the FE.

Requesting anonymity the Asia Energy official, however, alleged that there are some recommendations that do not fit with the reality.

"There was no forecast on the coal market," he said adding, "The issue of coal export was not rightly assessed."

The review committee in its recommendation opined that there is no scope of coal export to ensure energy security for next 50 years.

Asia Energy official, however, acclaimed the committee recommendation to select the mining method of any coalmines on the basis of experts' opinion along with the geological structure and coal depth.

The Asia Energy could consider the issue of joint venture with a state-owned company, he said adding, "The floating of Asia Energy shares in the Bangladesh stock market is already planned."

Asia Energy submitted a feasibility study and scheme of development report involving its $ 2.5 billion investment to develop Phulbari coalmine on October 2, 2005.

http://www.energybangla.com/article_det.asp?aId=845
Bangladesh: Decision on Some Investment Offers Likely by January 2008
[ Print ]


World


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The government of Bangladesh is actively contemplating deciding on some of the investment offers worth about $12.5 billion (1250 crore) by next month as part of its plans to gear up economic activities in the aftermath of the two consecutive floods followed by the recent cyclone Sidr.

Following appointment of Kamal Uddin Ahmed as the new executive chairman of the Board of Investment (BoI) on November 26 last, the government asked it to expedite the processes relating to the proposals.

A senior official said, "We were asked to contact the parties concerned to know their latest positions on the investment proposals before calling them to resume negotiations."

Requesting anonymity, he said the foreign investment proposals, lying with the BoI since long, include $3.0 billion from India-based Tata, $2.5 billion from the UK-based Asia Energy, $ 1.6 billion from the US-based Vulcan Energy, $1.5 billion from the South Korean Luxon Global, and around $ 1.0 billion from the Saudi Arabian Kingdom Group.

There is also another foreign investment proposal from the Global Steel Holdings Ltd (GSHL), a subsidiary of the UK-based Mittal Group, involving $2.9 billion.

The fresh government move came in consideration of creating more jobs and gearing up the economy hit hard by the devastating floods and the cyclone Sidr.

The entire functioning of the BoI had been hampered for over a month after the government, in a major reshuffle in the administration on October 18, transferred its executive chairman Mohammad Mohsin as secretary to the Energy and Mineral Resources Division, among other five top bureaucrats.

During the period the BoI had to postpone many of its meetings in absence of its chief, BoI insiders said, adding that even a meeting with Chief Adviser Fakhruddin Ahmed scheduled for November 8 to discuss the overall investment scenario and other issues was also postponed.

A significant decline in registering investment proposals has already worried the BoI insiders as both local and foreign investors are adopting a wait and see approach, they said.

According to the World Investment Report-2007 published recently, Bangladesh received $792 million (79.2 crore) in foreign direct investment (FDI) in 2006, 6.0 per cent less than that of 2005.

In 2005, the actual FDI inflow was $845 million, the highest ever in a single year.

BoI insiders expressed their fear that in the current year investments might decline sharply as a longstanding effect of last year's political turmoil and a sluggish trend in registering investment proposals.

Registration of investment proposals, both foreign and local, declined significantly, about 30 per cent, in the first nine months of 2007.

Although the BoI targeted FDI worth $1.0 billion for 2007, the current trend proves that it might not be possible for the current year as large investment proposals are still hanging in the balance.

When asked, sources expressed their reluctance to give details of the investment offers, which are on top of the list for decision by next month. The government is actively contemplating deciding on some of the investment offers worth about $12.5 billion (1250 crore) by next month as part of its plans to gear up economic activities in the aftermath of the two consecutive floods followed by the recent cyclone Sidr.

Following appointment of Kamal Uddin Ahmed as the new executive chairman of the Board of Investment (BoI) on November 26 last, the government asked it to expedite the processes relating to the proposals.

A senior official said, "We were asked to contact the parties concerned to know their latest positions on the investment proposals before calling them to resume negotiations."

Requesting anonymity, he said the foreign investment proposals, lying with the BoI since long, include $3.0 billion from India-based Tata, $2.5 billion from the UK-based Asia Energy, $ 1.6 billion from the US-based Vulcan Energy, $1.5 billion from the South Korean Luxon Global, and around $ 1.0 billion from the Saudi Arabian Kingdom Group.

There is also another foreign investment proposal from the Global Steel Holdings Ltd (GSHL), a subsidiary of the UK-based Mittal Group, involving $2.9 billion.

The fresh government move came in consideration of creating more jobs and gearing up the economy hit hard by the devastating floods and the cyclone Sidr.

The entire functioning of the BoI had been hampered for over a month after the government, in a major reshuffle in the administration on October 18, transferred its executive chairman Mohammad Mohsin as secretary to the Energy and Mineral Resources Division, among other five top bureaucrats.

During the period the BoI had to postpone many of its meetings in absence of its chief, BoI insiders said, adding that even a meeting with Chief Adviser Fakhruddin Ahmed scheduled for November 8 to discuss the overall investment scenario and other issues was also postponed.

A significant decline in registering investment proposals has already worried the BoI insiders as both local and foreign investors are adopting a wait and see approach, they said.

According to the World Investment Report-2007 published recently, Bangladesh received $792 million (79.2 crore) in foreign direct investment (FDI) in 2006, 6.0 per cent less than that of 2005.

In 2005, the actual FDI inflow was $845 million, the highest ever in a single year.

BoI insiders expressed their fear that in the current year investments might decline sharply as a longstanding effect of last year's political turmoil and a sluggish trend in registering investment proposals.

Registration of investment proposals, both foreign and local, declined significantly, about 30 per cent, in the first nine months of 2007.

Although the BoI targeted FDI worth $1.0 billion for 2007, the current trend proves that it might not be possible for the current year as large investment proposals are still hanging in the balance.

When asked, sources expressed their reluctance to give details of the investment offers, which are on top of the list for decision by next month.

Coal mining at Borapukuria resumes


DINAJPUR, Jan 14: Mining of coal from the Borapukuria field resumed today after two months with the prospect of yielding 2,000 metric tons per day, reports UNB.
This will facilitate full-fledged operation of the adjacent coal fired 250-megawatt thermal power plant easing the shortage of power supply.
Dr M Tamim, who took over the charge of energy ministry as special assistant to the Chief Adviser on Saturday with a pledge of exploration of energy sources, went 1400 feet down the mine to see resumption of extraction of coal.
Extraction started at 1pm from the coal phase No. 1103 prepared following operation of 1109 completed on November 19 last year and overhauling of the equipment.
"Hopefully, operation of this phase will go on without disruption," former BUET professor and mineral expert Dr Tamim told newsmen at the coal field.
He estimated that 3.57 lakh metric tons of coal will be extracted from 1103, operation of which will continue till July next.
Extraction of coal in phase 1110 was abandoned in July last year as gas was wobbling out. Following that the well was sealed and the equipment was brought out with much difficulty.
Managing director of the coal field MA Aziz Khan informed the special assistant to the CA that one thousand metric tons of coal will be extracted every day during the first seven days. Thereafter 2000 tons will be extracted to meet the demand of the power plant.
He said, about 500 metric tons of coal was available every day from the process of developing of phase No. 1104. More than 4.46 lakh metric tons will be extracted from 1104.
Petrobangla director Moqbul-e-Elahi, coal field MD Aziz Khan, DC Saiful Hasan were among those present at the function.

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Asia Looks to Coal As Oil Price Surges
By David Winning
Word Count: 586 | Companies Featured in This Article: Sasol
BEIJING -- Vast coal reserves in Asia are gaining attention as major energy consumers such as China and India grapple with the reality of oil prices around $100 a barrel and the risks they pose to their economies.

Multibillion-dollar facilities that convert coal to oil are being studied across Asia, while utilities are shelving plans to build power plants that use natural gas or fuel oil because prices of those fuels track the cost of crude.

Crude-oil futures on the New York Mercantile Exchange are more than 50% higher than they were a year ago and are within sight of ...

DHAKA (Reuters) - Asia Energy Corp (Bangladesh), sister firm of UK-based GCM Resources PLC, has proposed to build a 1,000 megawatts (MW) power plant using coal from Bangladesh's northwest field, a senior energy official said on Saturday.

The firm submitted a plan to the Bangladesh government to develop a coal mine at the field at Phulbari, 350 km (220 miles) northwest of the capital Dhaka, using open pit mining technology.

"We have received the proposal (for the power plant) through the board of investment, but before giving them any green signal, we need to get an approved national coal policy," the government official said.

A committee appointed by the ministry of power, energy, and mineral resources submitted a draft coal policy to the government last week for approval.

"Bangladesh is facing a recognised shortage of energy and power and the situation is worsening, ... and coal-fired power stations are being seriously discussed by the government and people," said Gary Lye, chief executive officer of the Asia Energy Corp (Bangladesh).

Bangladesh faces a power deficit of up to 2,000 MW against demand of 5,000 MW daily, energy officials said.

Frequent power failures cut the country's gross domestic product by around $1.0 billion annually, the World Bank said, and would need $10 billion invested over the next 10 years to overcome the shortages.

Asian Development Bank had said they would assist the authorities to build power plants to generate 2,000 MW at Phulbari.

"Before financing to a major power station, one needs to have a fuel supply guarantee. With the plus 35 years life span of the Phulbari Coal Project, Asia Energy is in a position to offer such a guarantee," Lye told Reuters.

Asia Energy mining company is lining up an offer to invest $3.0 billion in a Bangladesh coal project, which can produce 15 million tonnes of coal a year and can give the state $7.8 billion in revenues over 30 years, Lye said.

"We are ready to start work as soon as we receive green signal from the authority," he added.

During the feasibility study in 2004-2005, Asia Energy drilled 108 holes and defined resource of 572 million tonnes of high quality coal at the Phulbari coal basin project.

The current coal reserve in the country's five coal-fields is around 2.55 billion tonnes, including Phulbari, officials said.

Experts said gas reserves in the country were fast depleting, so its power plants should be coal-based.