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/

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I to hope all be it slow things are slipping into place ! as to gpn will be Interesting to see what unfolds ?

Emergency rule boosts Bangladesh garment exports: industry
11 hours ago 09/08/2008

DHAKA (AFP) Bangladesh's garment exports are booming thanks to a new, stable business climate under the country's state of emergency, officials said Wednesday.

The nation's exports of knitted and woven items rose by nearly 17 percent to a record 10.7 billion dollars in the financial year to June 2008.

"We had an image as a strike-prone country. Buyers from all over the world used to worry a lot about whether our manufacturers could meet shipment deadlines," Export Promotion Bureau chief Shahab Ullah told AFP.

"But the state of emergency brought much-needed stability as there have been hardly any strikes."

The garment export growth rate in the last financial year was up only marginally from the previous year's 16 percent rise.

But industry officials said the headline figure masks a big achievement considering exports fell 5.37 percent in the first quarter of the last financial year, amid concern about the country's political outlook.

It took a while for buyers to realise that Bangladesh could be a stable supplier of garments and after that "export orders jumped," Ullah said.

"To buyers, stability means a lot," said Anwar-ul Alam Chowdhury Parvez, head of the Bangladesh Garments Manufacturers and Exporters Association, which covers 4,200 factories.

Chowdhury said global buyers -- mainly from the US and the European Union -- started looking towards Bangladesh from October.

Exports leapt by 51 percent year-on-year in January and by more than 20 percent in the other months until the end of the financial year.

A state of emergency was imposed in Bangladesh in January 2007, banning strikes after months of bitter political and industrial unrest that left dozens killed and closed factories and ports.

The military-backed government has promised elections in December 2008 after it completes political, electoral and economic reforms.

Garment industry officials said they hoped the industrial climate would remain stable after democracy is restored.

Constant general strikes paralysed the country amid a duel between Bangladesh's two main rival political parties, the Awami League and the Bangladesh National Party, before the imposition of emergency rule.

The garment trade accounts for 40 percent of all industrial jobs in Bangladesh, with women making up more than 80 percent of the workforce.

Some 40 percent of Bangladesh's 144 million people live below the poverty line. Poor households spend nearly 70 percent of their income on food.

Garments, which make up three-quarters of the impoverished country's export earnings, helped boost total exports by 16 percent to a record 14.11 billion dollars in the last financial year.

http://www.steelguru.com/news/index/2008/06/09/NDk2MzE%3D/Bangladesh_to_adopt_coal_policy_soon_to_increase_production.html

http://www.theindependent-bd.com/details.php?nid=93370

Cabinet to discuss draft coal
policy in Ctg on Aug 13
Staff Correspondent
The draft coal policy is scheduled to be placed for approval before the council of advisers at the weekly meeting in Chittagong on August 13 (Wednesday) amid controversies persisting for two years.
A number of energy experts alleged the Energy Division had dropped off the latest draft some provisions such as return of mined land to owners, which was in the draft prepared by an advisory committee, in aid of foreign companies such as Asia Energy.
The division officials, however, brushed aside the allegations saying the provisions were dropped to avoid complexities in future. They said it was not true that the division was thinking of any specific foreign company.
The advisory committee, headed by former BUET vice-chancellor Abdul Matin Patwari, submitted the seventh draft, which was finalised in 19 meetings, to the division in January. The division finalised the eighth draft in six months and sent the draft to the Cabinet Division in July to be placed for the approval of the council of adviser.
The draft is likely to be placed at the council meeting scheduled for Wednesday in Chittagong, said a source in the Energy Division.
The energy experts, however, criticised the division for dropping a provision off the draft prepared by the Patwari committee that the land, to be acquired for mining, would be returned to the owners after the recovery of the land in its original form after mining.
The division has also dropped another provision that set the criteria based on which royalty rate would be set by a proposed coal sector development committee.
The experts also criticised the division for withdrawing the sections on environmental management during mining from the main text of the policy and including them in the policy appendix.
Energy expert Professor Nurul Islam of Bangladesh University of Engineering and Technology, who was one of the members on the Patwari committee, told New Age on Sunday if the council approved the latest draft without any change, the economy would be affected, the interest of the affected people of coal mine area would be hampered and the companies interested in coal mining would get additional benefits.
He alleged the latest draft had dropped some provisions of the Patwari committee draft in aid of the controversial Asia Energy for its proposed Phulbari coal project.
The latest draft says the recovered land would be used properly although the previous draft said the land would be recovered after mining and would be given back to the owners by enacting a law, he said.
He said the provision was dropped to enable investors to make more profits as the handover of land to the owners involved cost.
An Energy Division source, however, said they had discussed the issue with the land and law ministries and the both recommended keeping the land under government as giving back the land to the owners would create huge complexities.
After 20 years of mining, if the government takes steps to give the land back to the owners, there will be debate over ownership and the government will face litigations. The existing act does not support that the government acquired land will be returned to original owners, he said.
He also brushed aside that the provision was dropped for the benefits of the investors. We have not said that the land would not be given its original shape. Giving the land its original shape and not returning it to the owners will entail cost, he said.
Nurul Islam differed on the view of the Energy Division on the possibility of litigations over ownership. We are living in an ear of technology, and not in 19th century. It is now easy to keep record of the owners and their family members even with photographs. If the government is sincere, it can return the land to the owners. And for that, we have proposed enactment of a law if the existing laws do not cover the issue, he said.
He also observed the division had intentionally omitted the criteria based on which the coal sector development committee would set the royalty rate.
At our committee meeting, we tried to set the royalty rate but because of pressure of the lobbyist of Asia Energy, it could not be done. Then we recommended some criteria based on which the royalty rate will be set. But that recommendation has also been doped, he said.
He demanded that the government should set the royalty rate at 16 per cent and put a cap on coal price.
The Energy Division source said the Patwari committee had proposed a 28-member coal sector development committee to set the royalty rate. The committee will include people from all sections. The committee should be enough to set the criteria for the royalty rate, he said.
Nurul Islam also criticised the division for withdrawing the issues related to environmental management from the main text of the policy. Environmental management is an important issue in coal mining. This issue should be in the main text, and not in the appendix, he said.
Another member on the Patwari committee echoed what Nurul Islam said.
Asia Energy, meanwhile, has intensified its campaign for the Phulbari coal project as the council is set to discuss the policy.
The company has published a series of advertisement in national and local daily newspapers highlighting what benefits the proposed Phulbari open-pit mine would yield.

http://www.newagebd.com/2008/aug/11/front.html

August 12, 2008


Bangladesh draft coal policy sent to cabinet for approval
Energy Bangla reported that the energy division of Bangladesh sent a draft coal policy to the cabinet division to place it before the council of advisers for approval. Officials of the division are hoping that the much talked about draft policy would be placed before the council soon in any of its regular weekly meetings.

The countrys coal sector development, which has virtually remained stalled, is expected to begin once the coal policy is approved by the council. Special aide to the Chief Advisor, Prof M Tamim told Energy Bangla that this new policy will help to develop the coal sector of Bangladesh.

The policy has discouraged export of coal considering the demand for energy in the country, and suggested awarding of the exploration and development license of any coal field to a state-run entity, which will be able to take joint venture partner/partners through competitive bidding.

It has also recommended formation of a separate state-run entity, Khani Bangla to oversee the coal and mine related activities in the small scale pit mines to find out the viability of such mining method, and formation of a coal sector development committee to fix the royalty rate.

http://www.steelguru.com/news/index/2008/07/28/NTY0MDI%3D/Bangladesh_draft_coal_policy_sent_to_cabinet_for_approval.html

Draft coal policy for Mine Bangla
Proposal goes to cabinet today
Sharier Khan

The eighth draft coal policy that emphasises immediate government-led action in coal sector to meet the country's surging energy demand is likely to be placed before the caretaker government's cabinet today.

The draft proposes to set up a "mine Bangla" in line with Petrobangla by 2010 to spearhead different mining schemes. This government body will take strategic partners from private sector through open tenders for quick development of the schemes.

Other proposals include compulsory release of 20 percent shares of a mining venture to the local market as per the laws of the Securities Exchange Commission. When selling back, shareowners will be only able to sell those to the government at market price.

"Because of excessive revisions and inputs from a wide number of people, the draft policy now sounds more like a law than a policy," says a source. "And this was exactly the observation of the law ministry about the policy when the energy ministry sent the draft to the law ministry a few months back."

The draft policy tries to touch almost all aspects of coal development. "That is why the law ministry observed that instead of such a policy, the government should work on several laws instead of just one," the source adds.

The coal policy was first drafted in December 2005. The seventh draft was prepared by a committee to review the draft policy. Headed by former VC of Buet Prof Abdul Matin Patwari, the 10-member committee submitted its report to the energy ministry in December last year.

The ministry itself has also modified some of the contents. Only recently, the ministry has forwarded the draft to the Cabinet Division for approval by the cabinet.

Under this policy, private companies will not have sole ownership over any coal mining deal and must come as partners with a national coalmining company.

The draft restricts export of coal to be used as fuel, allowing exports of higher grade coking coal.

It lays out a detailed plan on how the government should handle rehabilitation and resettlement of communities that will be displaced by a mining project. The Patwari committee had suggested that the land acquired by a project be returned to the original owner upon completion of the project.

The land and the law ministries however deleted this part as it conflicts with the laws of the land. "Once the government acquires a piece of land, it can't be returned to the original owner. The government can however restore the land and allow its agricultural use," says a source.

The policy does not restrict open pit mining, as was initially demanded by some pressure groups. Instead, it identifies mining method as a technical issue, which should be decided on the basis of individual cases and technical viability.

The policy prioritises private partnership that puts highest emphasis on coal-fired power projects.

A 29-member committee led by the energy ministry will review coal sector master plan, royalty, the sector's development issues from time to time and give decisions.

By 2010, the government must frame a coal sector master plan, identify coal zones, review coal industry infrastructures and initiate restructuring measures.

It will also restructure the Bureau of Minerals Development and Geological Survey of Bangladesh and chalk measures to protect the environment and develop the legal frameworks for it.

The government will also have to chalk out a security measure for mines and a plan to reclaim land.

The draft recommends that the government decide on implementing an open pit mine as a "test case" in the northern part of the Barapukuria underground mine. If such a venture is "commercially successful", the government will review all technical aspects and take follow-up measures.

"There has been no study by any group about such an open pit mine in Barapukuria. How can this committee suggest this? Besides, who would invest for a test case if there is no guarantee of any profit?" asks another source.

"Again, technically you also need bigger land for an open pit mine. The Barapukuria mine area has a power plant and other structures. Then is this a feasible idea or just an undue idea?" the source quips.

The draft policy says till 2025 if Bangladesh's GDP remains as low as 5.5 percent, the country will need to add 19,000 megawatt additional power. On the other hand, if the GDP is as high as 8 percent, additional 41,000 MW power will be needed.

But at the same time, Petrobangla says production of gas, which has been the key source for power generation, will start to decline from 2011. This is where the country's coal should play a role.

It adds that to meet its power demands in a GDP growth rate scenario of 5.5 percent, Bangladesh will need 136 million tonnes of coal till 2025. If the GDP rate is 8 percent, then Bangladesh will need 450 million tonnes coal.

The draft says the country's existing four discovered coal fields of Barapukuria, Phulbari, Khalashpir and Dighipara can cater this need till 2030 or so.

http://www.thedailystar.net/story.php?nid=50253

Also on the eve of the Meeting !

Power sector in for grave crisis


Implementation of 14 power projects uncertain as Petrobangla drops gas commitment


Tuesday August 12 2008 00:56:38 AM BDT


The power sector is headed for a grave crisis as implementation of 14 proposed power plant projects with a composite capacity of 2,850MW has become uncertain with the Petrobangla withdrawing its commitment for immediate supply of gas.(The Newage)

Officials of Petrobangla at a joint meeting of energy and power divisions on Monday said it could at the moment supply gas to only three of the proposed plants 450MW Bibiyana independent power plant, 150MW Sylhet and 150MW Bhola plants.

They also said that they would supply gas to the under construction 11 short- and long-term rental power plants and seven out of 10 under construction small independent power plants, which are likely to be commissioned by January, 2009, as per Petrobanglas earlier pledge.

But, Petrobangla said, it would not be able to supply gas in near future to the 450MW Sirajganj IPP, 450MW Meghnaghat-III IPP, 450MW Bheramara power plant, 250MW Dhaka North Power Plant, 360MW Haripur, 210MW Khulna, 150MW Shikalbaha, 150MW Chandpur, 2x150MW Shiddhirganj, 150MW Sirajganj and 150MW Khulna plants, one unit of the under construction 2x120MW Shiddhirganj plant and three small independent power plants at Feni, Mohipal and Barabkunda.

Petrobangla, which had made the commitment to the Power Development Board in August, 2007 that it would supply gas to these plants between 2009 and 2012, backed away from the pledge asking the PDB to defer the projects by at least two to three years until gas supply could be ensured.

Of the power plants, power agencies have already invited tenders for the 450MW Sirajganj IPP, 210MW Khulna and 150MW Chandpur power plants. The government has also finalised lending agreements with Japan Bank of International Cooperation, Asian Development Bank and World Bank for the 360MW Haripur, 150MW Siddhirganj, 150MW Sirajganj, 150MW Khulna and 2x150MW Siddhirganj plants. The government has also awarded contracts to a Chinese company for setting up the 150MW Shikalbaha and three local entrepreneurs for installation of three SPPs.

Petrobangla in August 2007 also said that it would not make a commitment for gas supply to eight other power plants, including the 450MW Ashuganj power plant, 225MW Shikalbaha plant, 210MW Shiddhirganj second unit, 225MW Ghorashal plant, and 150MW Sylhet Gas Turbine. The Power Division did not proceed with the plants any further following the Petrobangla decision last year.

Petrobangla on Monday said it would supply gas to the proposed power plants in future if gas production in the country increased and new gas fields were discovered. Petrobangla currently supplies around 1,780 million cubic feet of gas against a demand for around 2000mmcfd. Power plants get around 650mmcfd against the demand for 850mmcfd.

It will be a severe blow to the power sector if Petrobangla does not supply gas to the proposed plants. Almost all of our projects have become uncertain which means we will not be able to install plants with a combined capacity of at least 3,000MW, said a PDB official.

He said that these plants were supposed to come into operation by 2012 when the demand for power would be more than 7,500MW.

At present, we produce around 3,300MW against the demand for around 5,000MW. We can produce around 3,800MW by January 2009 if the small IPPs and rental power plants come into operation and if gas is available to them. But after that only three power plants may come into operation, he said.

Power secretary M Fouzul Kabir Khan, who was present at the meeting, told New Age he did not think Petrobanglas refusal to supply gas to the power plants in the pipeline was final.

They have requested us to defer some of the projects because of gas shortage at present. We will review their proposals and will sit with government high-ups to discuss what can be done for the power sector, he said.

Energy secretary Mohammad Mohsin said that they were forced to request the PDB to defer some projects. What else can we do when we are facing a severe gas shortage because of increasing demand for gas in industries and CNG stations, he asked.

Mohsin, however, said that most of these projects would get gas once Petrobangla would augment around 300mmcfd of gas by 2012 from different fields.

Thursday, August 14, 2008 12:25 AM GMT+06:00


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Ctg to get emergency gas, rental power plant
Advisers' council sends back coal policy to ministry
Staff Correspondent, Ctg


The Council of Advisers at its meeting here yesterday decided to provide 20 mcf (million cubic feet) additional gas and set up a 50-MW rental power plant for immediate and short-term solutions to the acute gas and power crises prevailing in Chittagong.

Chaired by Chief Adviser Fakhruddin Ahmed, the meeting also discussed the draft National Coal Policy and asked the energy ministry to place the draft policy again after scrutiny.

Held at Chittagong Circuit House, the meeting decided to set up a separate gas distribution centre titled Karnaphuli Gas Systems Limited (KGSL) to ensure smooth distribution of gas in Chittagong.

To resolve seat crisis in the educational institutions, the meeting decided to increase additional 19,000 seats through infrastructure development of six private schools and setting up of two new model school and colleges here at a cost of Tk 71 crore.

Different local issues like acute gas and power crises and waterlogging prevailing in the port city featured in the meeting where we have tried to give some immediate and short-term solutions to the problems, said Chief Adviser Fakhruddin Ahmed at a press briefing after the meeting.

Additional gas will be supplied to the industrial units that could not go into operation for want of gas, he said.

As a short-term solution to power crisis, we have decided to set up a furnace oil-run rental power plant, he said, adding, Though we know it will be a bit expensive, we have to look for an alternative way of producing power as an instant solution.

Regarding the proposal for setting up coastal township in Chittagong by the world leading steel manufacturer, Mittal Group, the chief adviser said the government is actively considering the proposal.

Talks with Board of Investment (BoI) and others concerned are going on, he said, adding, Since it's a huge project all the details need to be discussed thoroughly.

Briefing the reporters, Commerce and Education adviser Hossain Zillur Rahman said 20 mcf additional gas will be provided for Chittagong through two separate supply lines from Bangura and Bakharabad gas fields.

Of the 20 mcf gas, 10 mcf will be supplied to the already installed industrial units that could not go into operation while the rest will be required for producing 40MW electricity at the existing plants.

Besides setting up of the 50MW rental power plant under short-term solution, initiative was there to ensure smooth and equitable distribution of power through demand management, said the commerce adviser.

He said a Tk 95 crore project for infrastructure and drainage system and a Tk 22 crore project on garbage management are awaiting Ecnec approval.

The meeting decided to provide all out cooperation for implementation of the Tk 10,000 crore JBIC (Japan Bank for International Cooperation) project for construction of outer ring road in Chittagong.

Besides, we will hold talks with the Italian ambassador for reviving and immediate implementation of Madunaghat Water Treatment Plant to resolve the water crisis in the port city, said the commerce adviser.

The meeting thoroughly discussed and laid emphasis on implementing projects for construction and repair of six inter-district highway and roads in this region, he said.

Moreover, the meeting underscored the need for taking decision on priority basis on construction of Chittagong-Dohazari-Cox's Bazar (upto Ghundhum bordering Myanmar) railway track involving Tk 1300 crore.

The meeting also decided to take up project for setting up the CDA proposed IT tower.

To overcome the godown crisis in the port city, the meeting decided to set up seven warehouses in the city's Dewanhat area.

Besides, the meeting also decided to approve two projects (Gymnasium and Prof Yunus Social Science Building) of Chittagong University and construction of an annex building of Chittagong Circuit House, said the commerce adviser.

UNB adds: while visiting the construction site of the 3rd Karnaphuli Bridge in the morning, the chief adviser directed the authorities concerned to complete the bridge and its approach road at the same time.

He mentioned that some big bridges in the country had been opened to traffic without completion of its approach road. As a result, full benefits of the bridges could not be derived soon after those were opened to traffic.

The CA was informed that the construction of 950- metre long and 24.47-metre wide bridge over the Karnaphuli is expected to be completed by July 2009, two months ahead of schedule.

The bridge is under construction at a site between Bakulia and Shikalbaha on the Chittagong-Cox's Bazar highway.

The total cost of the bridge along with 1.5 kilomtre approach road and 2.6 kilometre service road is Tk 590 crore of which Kuwait Fund for Arab Economic Development (KFAED) provided Tk 372 crore, while the rest Tk 218 crore was financed by the Bangladesh government.

The chief adviser expressed satisfaction with the progress of the construction work and hoped that the bridge would be opened to traffic well ahead of the schedule.



http://www.thedailystar.net/

a few more news clips out now very similar to the one above, and it would look as if they want to sort it out ! Just a small part of one of them !

The council, headed by the chief adviser, Fakhruddin Ahmed, at a meeting at the Chittagong circuit house, discussed the policy draft and the changes the Energy Division made to the earlier draft of the advisory committee of former BUET vice-chancellor Abdul Matin Patwari.

Although a number of advisers questioned whether the interim government which has only five months in hand should adopt such a sensitive policy, the council unanimously felt that a coal policy was needed to immediately address the growing energy crisis, said sources present at the meeting.




http://www.theindependent-bd.com/details.php?nid=93744

Cairn's Bangladesh field 'running dry'



Previous PreviousNext Next View GalleryPublished Date: 15 August 2008
By Hamish Rutherford
BANGLADESHI officials claimed to be caught by surprise yesterday after Cairn Energy, which operates Sangu, the country's only offshore gas field, warned the reserves could be exhausted by the end of 2009.
Mohammad Muqtadir Ali, a director of the state-run oil, gas and mineral corporation, Petrobangla, reportedly said the Scots company had told it that the reserves were being exhausted fast. "We have been frustrated by this information but will sit down with Cairn next week to try to sort out the problem," he said.

A spokesman for Cairn, which has been operating the Sangu field since 1998, declined to comment.

The company has warned in the past that the Sangu field is beyond peak production and it has reportedly told the Bangladeshi government informally of the probable timescale of production.

Cairn has explored unsuccessfully for other gas fields off Bangladesh in recent years.

Elsewhere the firm is recruiting more than 300 experts to help in the project to build a major pipeline to transport oil from its fields in the Indian state of Rajasthan to the coast.



http://www.scotsman.com/business/Cairn39s-Bangladesh-field-39running-dry39.4394009.jp

is this a personal diary then smiler

Aye ! as you can see I have been in GCM for a long time .... their is about 4/5 who post /hold on this thread

http://www.dailynews.lk/2008/08/18/fea03.asp

Share price has more than halved from its peak...now 146p

And ?

http://www.theindependent-bd.com/details.php?nid=94100

100p on the way

OK ! There always One on every Board !

Contingency Actions for Chittagong.
Saleque Sufi
Monday, 08.18.2008, 04:22pm (GMT)




Council of Advisors of the interim Care Taker Government of Bangladesh in its first ever historic cabinet meeting outside the Capital at Chittagong held on 13th Ausgust 08 has taken some very critical decisions in desperate efforts to salvage the major port cum industrial city from serious energy and water crisis. They say that some of these are short term, some mid term and some long term measures. The main problem that has almost reached crisis point is the energy crisis gas supply crisis. Shangu Gas Field which came into production in 1998 is alarmingly depleting in less than 10 years of production. The present daily gas supply to Chittagong is believed to be about 50MMCF short of meeting the existing demand. Shikalbaha Power plant remains out of operation.Raujan is forced to be run on 50% capacity, new gas connection to industrial consumers and CNG refuelling stations are kept pending. The gas crisis and consequential power shortage has very alarmingly impacted on business and commerce and is causing immense miseries to the people of the region. Among other notable problems are water supply problems, water logging due to lack of drainage, road and rail transport bottlenecks. Let us now try to have a feel what the advisors did in the meeting.



Formation of a separate Gas Marketing Company in the name of Karnaphuly Gas Systems Ltd (KGSL) has been approved to more systematically address the gas supply and marketing problems of Bakhrabad Gas Systems Ltd. Decision has been taken to set up a furnace oil based 50MW contingency power plant to bring into commercial use within 6 months. Decision has also been taken to increase about 20MMCFD Gas supply to Chittagong area 10MW to be used for generating power and the remaining 10 MW to be used for supplying gas to industries and CNG stations kept stand by for gas supply. Decision has also been taken to implement Modunaghat Water project expeditiously. As part of construction of Trans Asian Railway Network, it has been decided to improve the rail link from Dozajari to Coxsbazar and extend it to Gundum, the Myanmar border. Another important project approved in the meeting is the construction of two regulator vaults on the river Kranaphuly to improve water logging in the city. Several other issues creating more opportunity of aspiring youngsters getting improved education in schools expanding the infrastructures, expansion of Dr.Yunus Social Science building at Chittagong University, modernisation of Chittagong port plant quarantine project have also been given go ahead. No decision was taken on few other very important issues. Draft coal policy which created storm on the cup of tea, Billion Mega Investment Proposal of UK based Indian company Mittal Group and 4 lane Dhaka Chittagong highway did not get approval for further detail examinations.



The Chief advisor and his council of advisors must deserve thanks and appreciations for taking this unique initiative to hold the meeting outside Dhaka and address the specific problems of a very important region. Chittagong is our principal port of entry gateway. Most of our trading export and import routes through Chittagong. It is also our major industrial city. It also led Bangladesh in almost all historic movements. The commencement of liberation war was proclaimed from Chittagong on behalf of our Father of the Nation on 26th March 1971. The beauty of the east has enormous treasure; unique natural beauty which attracts tourists from all over the globe.Coxs Bazar, Technaf, St Martin,Rangamati, Kaptai, Chimbuk have superlative natural beauty which if appropriately developed for tourism can earn billions of dollars every year.Chittagonians dominated all the post liberation Government. The immediate past BNP led Alliance Government had 8 Minsters from Chittagong. They were all very influential. Yet Chittagong remained deprived. For reason unknown Chittagong did not get proper attention as far as its reliable energy supply is concerned. The Bakhrabad Gas field was primarily developed to cater Chittagong market. The multimillion dollar Bakhrabad -Chittagong Transmission System, South East Bangladesh Gas distribution Network was successfully accomplished on time to create long term Gas/Energy Security Infrastructure in Chittagong region. But the very unprofessional production management of Bakhrabad Gas Filed and later of Shangu offshore Gas Fields led to unforeseen rapid depletion of both the gas fields causing the present unbearable sitautaion.One must acknowledge that most of the present situation must be attribute to the failure of Petrobangla and Energy Ministry to professionally manage Gas production and supply. The Ashuganj Bakhrabad Gas Transmission Pipeline was constructed in 1997-98 by Hasina led Awami League Government as top priority national project to overcome the crisis of Gas supply in South East Bangladesh which was caused by unprofessional gas system operation by Khaleda Zia led BNP Government from 1991-96.In 1998 Shangu off shore Gas field was also brought on stream. Commencement of Production from Jalalabad Gas field, Beanibazar, Salda and Meghna Gas field created security of supply in national Gas grid. But the good works of Awami League Government could not be maintained by Hawa Bhavan influenced Khaleda led BNP Jamat alliance government in 2001-05.Cairn influenced Petrobangla and EMRD to inflate investment unnecessarily in Shangu, very unprofessionally attempted to produce about 200MMCFD from the tiny gas field ignoring the recommendation of Petrobangla reservoir specialist. Rapid depletion of Shangu field was observed. But following unfortunate death of Quazi Shahid the last of the Petrobangla patriot was gone.Ciarn kept on making futile attempts to increase production. It only increased cost but production dipped. In 2004 Shangu used to produce 140 MMCFD and now in 2008 it can hardly deliver 50MMCFD.Shangu was always a trouble maker. From 2003-05 when the author operated the national gas grid had to spent many sleepless nights managing the crisis due to forced outage of Shangu.Now Cairn thinks Shangu may deplete by 2009 and they want to invest more for compression and other efforts to increase production. Cairn several times before took Bangladesh for a ride. It has already become the sorrow of Chittagong. It will be better to discuss Shangu in details in another write up. The author knows about few more scandals of Shangu.

Chittagong demand is about 300 MMCFD now .If we add another 30mmcfd for rest of BGSL System then the total daily demand is 330mmcfd. But in the present situation the maximum supply is 280mmcfd.

The present deficit of gas supply is about 50 mmcfd. It is not clearly understood what the additional 20 MMCFD gas supply that the Advisory council decided will mean. Will it reduce the deficit? Or it will be extra over after the deficit is met? In that situation Chittagong region needs about 70 MMCF additional supplies not 20 MMCF as the decision indicates.



Let us look at the Gas Production, Transmission and Marketing Situation of the day when the Advisors met at Chittagong.



The national Production was 1796 MMCF against the capacity of 1838 MMCF. Petrobangla report indicates the supply was 1813MMCF.The report also indicates BGSL System got 289MMCF while Rauajan Unit 1 and Shikalbaha remained shutting down due to gas supply shortage. In this situation it is very difficult to ascertain how 20MMCF additional gas supply for Chittagong will bring any relief for the City in the crisis. Moreover Shangu is fast depleting ominously. Hope some people are not making joke here. If Shangu really depletes by 2009 all gas for Chittagong will require to be transmitted from National Grid mostly from North Eastern Gas fields. This will require installation and commissioning of Pipeline Compressors at Muchai and Ashuganj and construction of another Transmission pipeline from Bakhrabad to Chittagong.

Production:



BGFCL:



Gas Field
Producing Wells
Production Capacity
Production on 13th August 08

Titas
14
405
393

Bakhrabad
4
34
33

Habiganj
9
246
241

Narshingdi
2
35
35

4
29
720
702




IOCs

Operating Company
Gas Field
Producing Wells
Production Capacity
Production on 13th August 08

Cairn
Shangu
6
60
50

Chevron
Jalalabad
4
230
183


Maulavibazar
4
100
80


Bibiyana
12
450
525

Niko
Feni
3
05
03

Tullow
Bhangura
2
70
70

4
6
31
915
911




SGFL



Gas Fields
Producing Wells
Production Capacity
Production on 13th August 08

Sylhet
2
07
04

Kaillashtilla
6
97
98

Beaniazar
2
18
0

Rashid poor
5
53
51

4
15
175
153

Beanibazar
Shut Down
For
Maintenance






BAPEX



Gas Field
Producing Wells
Production Capacity
Production on !3th August08

Salda
2
11
10.6

Fenchuganj
1
17
19.4

2
3
28
30.0




From 16 producing gas fields of three national and 4 International producing companies the production of the day was (30+153+911+702=1796 MMCFD)



Against the above production scenario the marketing situation on the day read.



TGTDCL:



Sector
Demand
Supply

Power
601
494

Fertilizer
156
110

Others
..
707

Total

1312




Ghorashal Power Plant Unit 1, Horipoor PB Plant, Tongi Power plant and Urea Fertilizer Plant Ghorshal remain shutting down.



BGSL:

Sector
Demand
Supply
Comments

Power
106
28
Deficit 78MMCF

Fertilizer
115
105
Deficit 10MMCF

Others

151
Significant suppressed demand




From the above figures it is evident that 20MMCF increase from whatever source may be to Chittagong area will o nothing compare to the requirement. Moreover by the time this 20MMCF comes into effect Shangu may deplete further as Cairn has indicated its probable demise by end 2009.From the above analysis it is not understood what the promise 20MMCF additional gas is going to change the present diabolic gas supply situation in Chittagong. The persons who worked out this must have tried to fool the nation. It does not require the Advisory Council meeting to take this decision.GTCL system operator can always divert this gas from the System line pack. It is pity that Gas Sector management now has to wait for Advisory council meeting to take this decision.



The decision to set up 50MW power plant on furnace oil is OK.But from the experience of other recent Contingency Power Plants implementation one has reason not to believe that the plant may not come into operation in 6 months as visualise by Dr Fakhrudin and Company.



There have been talks that to comfort energy supply to Power plants and residence gas supply to industries may remain suspended during Iftar and Shehri. Who will ensure that? Is it practically possible? The only possible way to create some flexibility in Chittagong gas market is to shut down CUFL for a while and use that 50MMCF gas for power generation and Industrial use. Shut down of ZFCL may help Titas System but it wont help Chittagong at all. Bakhrabad Chittagong Transmission pipeline can not carry the additional gas. Advisory committee should have decided to create additional Gas Transmission infrastructure for meeting the present and emerging requirement of Chittagong. Loop line of BKB-CTG is the only answer.



The advisory council did not approve the coal policy. The draft coal policy in its present shape can not be approved by interim or Care Taker Government. Some of the provisions contradict with existing laws. Only elected parliament can change or formulate new law. The draft policy can not be termed policy .It is as good as new mining law. Moreover some members of the committee considering that whatever they recommended must be approve in original shape.



We must not forget Bangladesh will run out of energy options very soon. If mining is not started for coal immediately the entire nation may soon plunge into devils darkness. We have destroyed gas structure of Bakhrabad and Shangu due to unprofessional production management, Titas gas field is leaking and Bibiyana Gas field is being use as Golden duck.



Fortunately or unfortunately our coal belt is also the major rice growing area. We must sacrifice some of these for the greater long term interest of the nation. In the Coal policy there must be very clear direction about relocation and resettlement and income regeneration of affected people. There must be clear guidelines how the mine area will be reclaimed to its original and better shape.



In every country the Government has sovereign right over subsurface resources. Any citizen or entity can own only surface land and structures or properties there on. Government reserves the right to acquire any property with few exceptions like Graveyards, holy places etc for any national purpose. The original owner is compensated as per existing land acquisition procedure. OK people in the Coal mine area may get additional benefit but there is no way the land can be returned to them after 30 years mining life. The author has talked with Queensland Government Land Officials who deals with mine lease. They told that in Queensland Australia the land for mining is either arranged by Mining Company through direct purchase from the owner or Government acquires it and lease to Mining Company. There are set rules in Environment Management System as to how the land will be reclaimed. The mining is one in such a way that these do not impact on existing Flaura and Fauna, cultural Heritage of the area. In case of strip /Surface/Open Cut mining the mining company rehabilitate the area where mining is complete progressively as per guideline in the mining lease. Only the last pit can not be rehabilitated .It becomes a sweet water lake. Very stringent water management is effected during mining. Australia is a dry continent .Water is very important in Australia. It appears that we need updating of Mining Law as the coal policy is no longer a policy .Update Mining law must give guidelines how to rehabilate the mined area an must very specifically address the water management.EMRD may take reference from Australian Land Ministry regarding land management in mining.



Environment and social management in mining are major issues .These must be properly addressed and given due attention in update mining lawyer must not engaged the same controversial persons having no practical mining experience in reviewing the policy. It can seek support from Bangladeshi Expatriate Community who have exposure to active mining or are engaged in various mining relating rearech in mine countries. Care taker Government may review National Energy policy , Mining laws and Draft coal policy an make a comprehensive policy paper and leave it for incumbent political government to take up for discussion in the first session of the next elected parliament. Any democratic government for its survival will definitely take up coal mining issue with due urgency.



The Advisory committee in this particular meeting could have discussed the engagement of IOCs for deep water exploration for petroleum. Council of advisors could have discussed possibility of expanding capacity of Kaptai Hydro electricity Generation and mini Hydro prospects of the region. It could have thought of Power Generation from Municipal wastes of Chittagong, Wind Power , Solar power and cultivation of special plant in fallow areas of Chittagong and Hill Tracts for bio fuel production could be discussed. Perhaps the Energy Ministry was least prepared. The Coal policy in its present shape should never even been placed to the council meeting.



Month of Ramadan is coming. There is no way the energy situation of Chittagong or rest of the country can be significantly improved. The present situation is already well beyond the capacity of inexperienced Care Taker administration .They should not make it more complex through impractical an unimaginative actions.




http://energybangla.com/index.php?mod=article&cat=SomethingtoSay&article=877

yes smiler but its the same sort on certain threads.......i think hyleo secretly wants uk to collapse and be bankrupt......maybe he wants western world to go that way......maybe hyleo is a russian spy!!! lol