A UK company is planning to build a huge coal mine in Bangladesh. The impacts would be devastating. The Asian Development Bank is considering supporting the project anyway.
By Chris Lang. Published in WRM Bulletin no. 128, March 2008.
The proposed Phulbari open pit coal mine in Bangladesh would divert a river, suck an aquifer dry for 30 years and evict thousands of people from their homes. Vast machines would dig a series of holes 300 metres deep over a total area of 59 square kilometres. The coal would be largely exported via a railway and port in the Sundarbans, the world’s largest mangrove forest.
The company behind the US$1.4 billion scheme, Asia Energy Corporation (Bangladesh), is a wholly owned subsidiary of a UK company, Global Coal Management Resources. The largest shareholder in GCM Resources is RAB Capital, a London-based hedge fund manager. Other shareholders include UBS, Credit Suisse and Barclays. In June 2008, the ADB’s board is scheduled to decide whether or not to provide a US$100 million loan and US$200 million political risk guarantee for the project.
During an ADB mission to Bangladesh in October 2007, mission leader Kunio Senga told journalists that “coal mining is going to give huge potential benefit for power generation.” Senga added, “Coal mining is very effective.”
The mine would displace 40,000 people according to Asia Energy. Activists state that the number of people affected could be more than ten times this figure. “No matter wherever we are put, if we get evicted from our homes, we will lose our traditions, social organisation and businesses. These losses are beyond compensation,” Nima Banik, a lecturer at Phulbari Women’s Degree College told the Bangladesh NGO, Society for Environment and Human Development (SEHD).
The mine would cause noise and dust pollution through dynamite explosion. More noise and dust will come from the trucks and trains that would haul the coal away from the mine. Coal dust will pollute the air. Water will be polluted from washing the coal, risking pollution of surrounding water bodies. Bangladesh has networks of hundreds of small rivers, meaning that water pollution in one area can spread over a large area.
To prevent the mine from flooding, huge pumps would run 24 hours a day for the 30 years of the mining project, pumping up to 800 million litres of water a day out of the mine. Groundwater in an area covering about 500 square kilometres would be lowered. Wells would no longer provide enough water for farmers. Asia Energy’s solution is to distribute the water pumped out to farmers. “It is an open question if the water distribution would be even-handed,” notes SEHD’s Philip Gain. Once the mining is finished, Asia Energy plans to create a huge lake, providing fresh water, fisheries and recreation, according to the company. But after 30 years of digging, the water will be toxic.
Local opposition against the project is strong. In August 2006, about 80,000 people took part in protests against the mine. The paramilitary Bangladesh Rifles opened fire on the demonstration, killing five people and injuring hundreds. On 30 August 2006, the Rajshahi mayor, Mizanur Rahman, signed an agreement with the protesters on behalf of the government to kick Asia Energy out of the country and to ban open-pit mining in Bangladesh. Well over a year later, the government has yet to scrap the deal with Asia Energy. Meanwhile the government is working on a coal policy which in its current draft form would allow open pit mining.
Under the military government which declared emergency rule in January 2007, public protest is banned. Nevertheless, in December 2007, representatives of the sub-districts of Phulbari and neighbouring Birampur, Nababganj and Parbatipur wrote to the president and executive directors of the ADB. The project will “increase the poverty of the local population as well as cause environmental disaster,” they wrote.
The Bangladesh government’s Department of the Environment has set up a Climate Change Cell. “Rapid global warming has caused fundamental changes to our climate. No country and people know this better than Bangladesh, where millions of people are already suffering,” states one of the Climate Change Cell’s documents. “Development must ensure reducing the risks posed by climate change to people’s lives and livelihoods,” it adds.
The Climate Change Cell gets more than 90 per cent of its funding from the UK’s Department for International Development (DfID). Nowhere in any of the documents on its website does Climate Change Cell mention Phulbari. Yet the coal from the Phulbari coal mine, if it is extracted and burnt, will add a total of more than 1.2 billion tonnes of carbon dioxide to the atmosphere.
Gordon Brown, the UK prime minister, claims to be concerned about climate change. At a recent meeting with Bangladesh’s interim head of government, Fakhruddin Ahmed, Brown promised that “Britain would continue to work closely with Bangladesh bilaterally and internationally to secure an effective response to combat climate change.” The Phulbari coal mine makes a mockery of this statement.