August 29, 2006

Canary in the coal mine: what the deaths in Phulbari mean to Bangladesh

Is the price of coal more than human? At least 5 people died as the security forces opened fire on an uncontrollable protest by the inhabitants of Phulbari while they were demonstrating against the Asia Energy Corporation's Phulbari coal project, which is feared to have a great environmental impact if goes into operation. While the open pit method, a specific method of surface mining promises 80% extraction of the Phulbari reserves it has certain severe environmental impacts. If the project comes into commercial production, more than 100 villages within a 59 sq. km radius will have to be evicted and estimated 100,000 inhabitants relocated. Everything on the ground will perish and will not be reusable even years after the end of the project.

According to the New Nation the security forces did not handle the situation well and there were some provocations. It seems people were not in terms with the Asia Energy's public relation initiatives and aware of its rehabilitation commitments. They demonstrated primarily on the fear of being evicted from their livelihood.

Bangladesh is sitting on a considerable amount of coal and gas reserve. The first big coal reserve found in Barapukuria (Estimated Reserve: 390 Million tons; depth: 119 504M; extractable: about 78 million ton by UG method at about 20%), which is being extracted through underground method by hiring a Chinese company and Bangladesh has the ownership and freedom of use of the mined coal. But what is troubling is the change in government's energy policy. In 1995, it gave licenses to explore and develop a coal field to BHP, an Australian mining company. The Phulbari field was discovered in 1997 (estimated reserve: 426 572 million tons; depth: 140 350M; extractable : about 68 114 million by UG or 340 457million tons at 80% by open cast method). Phulbari is about 350 kilometers northwest of the capital, Dhaka and just 10 kilometers east of the Indian border in the north of Bangladesh.

BHP later divested its Phulbari contract to Australian Asia Energy Corporation Proprietary Limited, which was acquired by Asia Energy Plc., based in London in 2003. Asia Energy Corporation (Bangladesh) Proprietary Limited, a subsidiary of Asia Energy PLC was formed specifically for the Phulbaria project and the Bangladesh government reassigned BHP's licenses and contracts in full to them.

The full contract of the government with the AEC is yet to be made public. What is known to public is that Bangladesh will only get 6% as royalty, 14.52 million tons, worth $726 million out of expected 242 million tons, worth US$ 12,100 million for the investor at US$50/ton. Considering the environmental damage and the cost of land its more like awarding Asia Energy the project free. Dristipat has more details and links to the story. Salam Dhaka says Asia Energy is a stock market scam.

It is now time for the nation to press the government to disclose the full details of the contract with AEC, and action should be taken if it does not protect the national interest. The energy policy needs to be made beneficial to the country. Like a canary in the coal mine, these brave people gave their lives to warn us.

Update: The Australian government has a renewed travel advisory for its people. A bit overreacting I presume.


Post a Comment