Phulbari Coal Project
PROJECT TITLE
Phulbari Coal Project
LOAN AMOUNT
$100 million Private Sector Loan
$200 million ADB
COUNTRY
Bangladesh
The Phulbari Coal Project involves the extraction of coal using the open-pit mining method.
It involves the construction of a 500-MW power plant. According to the ADB, at full production, about eight million tons of coal will be transported by rail and barges to an offshore reloading facility located in Akram Point. Some four million tons will be exported to India via railway. The remaining three million tons will be for domestic use.
However, as much as the economic benefits it intends to bring to Bangladesh, the project will not only pose a health hazard but displace around 50,000 people. Likewise, Akram Point, where the reloading facility will be located, is in Sundarbans Mangrove Forest – a UNESCO-declared world heritage site. Transportation of millions of tons of coal through Sundarbans and Akram Point will also have serious environmental impacts
ISSUES
VIOLATION OF ADB’S ENERGY POLICY
According to the Energy Policy, the ADB should only approve the financing of a mine-mouth project if it would improve the efficiency of the project owing to the immediate proximity of the power plant that will use the extracted fossil fuel. However, the greater bulk of extractive activities is geared for export. The majority of the coal that will be extracted will be used by communities outside Phulbari, more so, outside Bangladesh. This should have already been a strong cause for the Bank’s officials and staff to reject the proposal.
MASSIVE DISPLACEMENT
The Phulbari Coal Project will approximately affect 50,000 people, which includes 12,000 households and 2,200 indigenous peoples in the project area alone. Around 43,000 people will be displaced upon the implementation of the project.
According to the Resettlement Plan for Coal Mine Area of Phulbari Coal Project, compensation would be provided to legal land and house owners. People whose livelihoods may be affected will also be given livelihood restoration grants for a period of two years. However, with the current declaration of emergency in the country, suspension of fundamental rights, curtailing of freedom of expression by media, and regular violent suppression by local authorities, implementation of such resettlement plans is highly questionable.
HUMAN RIGHTS VIOLATION
Serious human rights violations have been committed to the people of Phulbari because of the project. In August 2006, the Bangladesh Rifles, a paramilitary force, opened fire on the 50,000 local people who were conducting a peaceful protest. Five people were killed, which included a 14-year old boy, and 100 people were wounded.
In February 2007, Mr. S.M. Nuruzzaman was tortured in public and thrown into jail for allegedly joining the protest against the project.
LACK OF INFORMATION AND CONSULTATIONS
Local elders have claimed that Asia Energy Corporation, a UK-based company that will implement the project, has only told the benefits of the project. In spite of the demands made by the chairman of Phulbari Pourasaua and elected commissioners of Phulbari, it has not disclosed the negative impacts it may cause the environment and local communities, and how such problems may be mitigated.
FALSE STATEMENTS AND SOCIAL UNACCEPTABILITY
According to the ADB, the majority of the protesters in August 2006 were non-residents of Phulbari. This is in complete contradiction to statements made by local people that most of the demonstrators, including all the victims who were killed and injured, were Phulbari residents.
Likewise, according to Mines and Communities, a British NGO, the majority of the people who have signed the visitor’s logbook, who are supporting the project, in the Information Center were non-residents of Phulbari and whose signatures could not be verified. This is contrary to the claims made by Asia Energy in its submitted Environmental Impact Assessment (EIA) report that 80 percent of the visitors are accepting the project.
UPDATES: