Regional Coal: Asia Energy to invest 1.4 billion dollars in Bangladesh coal mine

London-based Asia Energy Corp said it plans to invest 1.4 billion dollars over the next three decades in a coal mine in northern Bangladesh.

"Our drillings have established that the Phulbari coal field in northern Bangladesh has resources of 522 million tonnes of high-quality coal," Brian Mooney, Asia Energy's head of corporate affairs, told AFP.

"Over the 30-year life of the mine the company will invest 1.4 billion dollars, and approximately half the amount will be spent on the start-up," Mooney said Saturday as the company drilled its final test hole in a 10-month exploratory programme.

The quality of coal in Bangladesh has been described as the highest in Asia. Northern Bangladesh alone has five top mines with estimated reserves of more than two billion tonnes of high volatile low-ash, low-sulphur bituminous coal.

Asia Energy, a London-based Alternative Investment Market-quoted company, began its drilling programme in the Phulbari basin in September 2004 and expects government approval for mining by the end of 2005.

"We will start mining operation from 2006," Mooney said. "At full production, the mine will produce 15 million tonnes of coal a year, both for the local and export markets."

Asia Energy's announcement came two weeks after Bangladesh's state-owned Petrochemical company, Petrobangla, signed an 82-million-dollar deal with two Chinese companies to extract coal from Boropukuria.

Situated in northern Dinjapur district, 300 kilometres (200 miles) north of the capital Dhaka and 40 kilometres from the Phulbari coalfield, Boropukuria has reserves of 390 million tonnes of fine quality coal.

Bangladesh's energy minister said earlier this month that a number of foreign companies -- including India's Tata Group -- are seeking licenses to develop coalmines in Bangladesh.(*)