Energy Bangla

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Dhaka Friday,  May 14, 2021

Webinar: Bangabandhu, Energy Security and Today’s Bangladesh

EB Report


Speakers in a webinar organized recently by Forum for Energy Reporters Bangladesh- FERB, stressed on domestic coal extraction and good governance in energy sector to achieve energy security of the country. They said, the country has a reserve of 3.1 billion tonnes of high-quality coal, but the government is yet to take effective steps to extract this resource and utilize it for power generation. The same is true for the ‘well studied’ Phulbari Coal Project, decision of which has been hanging for years. They also opined that existing reserve natural gas will be depleted by 2031. However, it is stated from the policy makers that the extraction of coal is a matter of political decision. However, the government is exploring suitable technology to extract country’s natural resource without affecting agricultural land and environment.
Mollah Amzad, Editor, Energy and Power presented the keynote paper in the webinar titled “Bangabandhu, Energy Security and Today’s Bangladesh” organized jointly by FERB and BIPPA (Bangladesh Independent Power producer Association). Mr. Nasrul Hamid, State Minister for Power, Energy and Mineral Resources was the chief guest and Dr. Mohammed Farashuddin, Former Governor of Bangladesh Bank and PS to Bangabandhu was the special guest. Khandoker Abdus Saleq, energy expert, Mr. Mortuza Ahmed Faruque, Former Managing Director, BAPEX and Engineer Khaled Mahmood, Former Chairman, BPDB took part in the discussion. Chaired by Mr. Arun Karmakar Chairman, FERB & Adviser Editor Energy Bangla and anchored by Mr. Shamim Jahangir, Executive Director, FERB, among others who spoke in the webinar were senior journalist Shahnaz Begum, Rafiqul Bashar, Shahed Siddique, Azizur Rahman Ripon.
The speakers including the keynote speaker in the webinar, first of its kind by FERB, identified both achievements, as well as a number of concerning issues in the energy sector including the unexplored domestic coal resources, the long-waited Phulbari Coal Project, and lack of good governance in energy sector etc. It is worth important to present detail of the virtual seminar as issues relevant to energy sector were extensively discussed.

The summary of the speech is given below

Mr. Nasrul Hamid, State Minister for Power, Energy and Mineral Resources
Mr. Nasrul Hamid, in his delivery as chief guest said, we have kept all avenues open for energy diversification, so that if we face trouble with one, can switch to another. PSMP-2010 has been reviewed in 2015, which is obvious given the change of global scenario. Regarding domestic coal extraction, he said, coal is there; but it is matter of political decision on whether to be extracted or not. We have to assess the environmental impacts and how coal can be extracted avoiding farmlands with support to affected people. This is the priority. People and environment are the priority to Sheikh Hasina. She already directed to make a move, if possible, without making harm to those. So, we are exploring that technology. It is not like that we would not do anything; coal is being extracted. We want to see how water can be managed; there is huge amount of groundwater in the area. He also added, there are issues like whether domestic coal extraction would be profitable, or import would create bigger opportunities.
Mr. Nasrul said, appropriate manpower and experts are needed to face future changes. Astonishingly, we have mine but there are no mining engineers. There was strong debate on coal-based power. We have sent professional journalists to visit coal-fired power station abroad. He urged to physically visit instead of doing debate in Dhaka to see whether coal-based power plants are the reason of any deaths or how far it affects the environment.
Dr. Mohammed Farashuddin, Former Governor, Bangladesh Bank and PS to Bangabandhu
Dr. Mohammed Farashuddin said, Bangabandhu was a man of great wisdom with vision. Regarding energy issues, he said, energy-power is such a thing that cannot be solved overnight. It is also an internationally sensitive issue. We have lot of achievement in energy sector, but there are challenges also. He added, the amount of high-quality bituminous coal we have in northern Bangladesh, can ensure power security for 20 years, provided if that coal is extracted by open pit mining method and used in power generation. There are problems, debate over issues and also is bureaucracy. Certainly, we need good governance and brilliant technologies in energy sector, but also need strong institutional structure. He also questioned whether experts are in same opinion on those issues or differ widely with each other.

Mortuza Ahmed Faruque, Former Managing Director, BAPEX
Mr. Mortuza Ahmed Faruque emphasized on strengthening BAPEX and urged to stop making frequent changes on the top management position to allow reasonable time to execute plans/programs properly. He said, the government is setting up coal-fired power plants based on imported coal, which is good but also need to focus on our own coal, which, as Mollah said, is about 3.1 billion tonnes. Bangabandhu had the vision to extract own resources and to make the country self-reliant in energy. We could realize his dream easily if our own coal resource is extracted and utilized. He added, the government could take initiative to do a feasibility study to assess whether coal can be extracted from Barapukuria by open cut method; but this is in a small area. Regarding Phulbari Project, he said, the coal here is at the shallowest depth, and is ready to be extracted having all sorts of studies done including environmental, water, resource assessment etc. However, the Project is hanging for years; hasn’t been terminated or accepted by the government. A decision needs to be taken on this Project. The government, if wish, may cancel with the company entirely, terminate the contract and start in a new way or may allow them to continue. A new initiative of open pit mining in Barapukuria will take time and may not be economic as the mining area is limited. But Phulbari is a proven field with all sorts of studies done. If we are to do open cut mining, then why not Phulbari! A quick decision on Phulbari would play a conducive role to mine our own coal and contribute significantly to achieving energy security of the country.

Khondoker Abdus Saleq, Energy Expert
Mr. Khondoker Abdus Salek said, I used to keep updated information about energy, power, and mineral resources of the country for my writing necessity. On coal transportation issue, he said, the power plants which are being constructed based on imported coal, particularly Payra and Rampal will face challenges for transportation of coal. Only exception is Matarbari. The coal terminal which is being constructed at Matarbari is probably dedicated for the two power plants there, and might need to think about a full-phased coal port at Matarbari area, from where coal can be transported to Rampal and even to Payra by upgrading the railway system. Expressing his frustration, he said, I will not talk much about coal, because many like to brand me as agent of coal when I come to the country. Regarding Phulbari, he said, I think there is one coal field in Bangladesh which is 100% ready to be developed. I don’t know who have gone through the Phulbari study reports, but if you go through, you will find the best consultants of the world have assessed the impacts of the Phulbari Project. He added, if you feel Asia Energy is a weak group, renegotiate with them. If you are strong, cancel the contract. Although I personally believe there will be legal challenge if the contract is cancelled right now and also a possibility that Bangladesh might need to compensate billion dollars to a company without developing coal field of the country. Therefore, try to extract own coal. He asked, particularly to PDB chairman, whether it was properly coordinated with coal extraction requirement while power plant was constructed in Barapukuria as it is obvious that transportation of imported coal to Barapukuria would not be a viable option. He added, the problems need to be seen from the perspective of practicalities.

Engineer Khaled Mahmood, Former Chairman, BPDB
Mr. Khaled Mahmud said, Mollah Amzad in his keynote paper stated to generate power plants at the northern region developing coal mines of the country. Yes, that is of course a good option, and would be cheaper, but needs additional infrastructural development with it. He said, we couldn’t run power plant after sudden shut down of coal extraction in Barapukuria mine. When we took initiative to import coal and invited tender, it found very costly. Where we used to buy coal at 130 USD/tonne from Barapukuria, but as there is no infrastructure, the quoted price was 250 USD/tonne. We could definitely get coal supply if there was coal handling infrastructure. There are challenges, it will always be there, and we must face it, he added.

Mollah Amzad Hossain, Editor, Energy and Power
Mollah Amzad in his keynote paper said, father of the nation Bangabandhu Sheikh Mujibur Rahman stressed on industrialization and to give people access to affordable energy using optimal uses of own energy resources. From this philosophy he formed the organizations like Petrobangla and put top priority on oil-gas exploration. Through onshore bidding process in 1973, foreign companies started oil-gas exploration in Bangladesh. Following the global oil crisis after Arab-Israel war, Bangabandhu decided to buy gas fields from the foreign companies and accordingly amended the law and on 9th August 1975, bought 5 gas fields at a cost of 4.5 million pounds. Presenting a brief picture of the energy situation, Mollah said, our natural gas resource will be depleted by 2031, if no new discovery is made. We have a reserve of around 3.1 billion tonnes of high-quality coal, equivalent to 76 TCF gas in terms of heat value but could not take affective decision in extracting the coal and utilization of this resource for power generation. The government is undecided on environmental and other issues. In the PSMP (Power System Master Plan), it is stated that 35% power will come from gas and LNG and 35% will be from coal; of which 34% will be from imported coal. Although it is stated in various analyses/research that power generation cost at mine mouth power plants using own coal would be about 30% less than the imported coal.
Bangabandhu’s philosophy was to meet energy demand using own resources and provide energy to all at affordable costs. We do not have that much of energy resources and no surprise that it would not always be possible to run with our own. There is no objection on import of LNG or coal, but if we put emphasis on the philosophy of Bangabandhu, then it has to be given priority on extraction and utilization of own energy resources, particularly gas and coal.

Arun Karmakar, Chairman FERB & Advisory Editor, Energy Bangla
Arun Karmakar said, there are lot of achievements in energy sector, but also there are challenges and complexities. But those, I believe, can be solved through implementation of good governance. He said, FERB is planning to organize more such discussions on various energy-related issues with participation of all stakeholders of power, energy, and mineral resources.

Shahnaj Begum, Special Correspondent, The Daily Observer
Shahnaj Beguam said, import of LNG is a ground-breaking initiative. There is no problem with import. Bangladesh is also good at paying import bills, never defaults. So, we will import, whatever needed. My position is against anything harmful for the country. She said, I could easily imagine how would have been the power situation of Bangladesh without the independent power. We know, energy and power, which are being imported, are also in the need of the country.

Rafiqul Bashar, Editor, Energy Bangla
Rafiqul Bashar, Editor, Energy Bangla said, if we make a comparison between previous policies with present, we will find many are just opposite with earlier ones. De-nationalization is against the feeling of 21-points of JuktoFront, 14-points of Awami League, 6-points of Bangabandhu and the historic speech of 7th march. Because those demands mainly aimed at nationalization and to eradicate economic division and inequalities. But that inequality remains in the energy sector today. People of a certain region have been enjoying piped-gas for cooking for a long, but other regions are completely deprived of the benefits of the resource. Now time has come to review all these aspects.

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