Around 20 million tons of coal are imported annually for thermal power plants in the country, utilised in six major power plants across Bangladesh, while all the coal extracted from the Barapukuria mine is consumed by the thermal power plant established in that area.
To address the energy deficit, the government announced plans to extract coal from the Phulbari mine in Dinajpur. Once extraction begins from this mine, 15 million tons of coal can be obtained annually, according to Barapukuria Coal Mining Company Limited (BCMCL) sources. Energy division policymakers said that in such a scenario, 75 percent of the imported coal demand for thermal power plants established in the country could be met from local sources. This will simultaneously reduce gas pressure for power generation, save a significant amount of foreign exchange, and lower the risks of import dependency, they said.
To tackle the country’s energy and power crisis, the government will release a 10-year master plan. The plan is scheduled to be presented in the national parliament this month, and it will also incorporate the local coal extraction policy, reliable sources said.
Finance Minister Amir Khosru Mahmud Chowdhury announced that the comprehensive energy policy will be published within the next two to three weeks. Speaking as the chief guest at a meeting organised by the American Chamber of Commerce in Bangladesh (AmCham) on Monday, the finance minister said, “Unfortunately, we’re now moving toward coal extraction. We have to proceed with open-pit coal extraction in Phulbari and other locations because we have no other alternative before us. We have more or less finalised our decisions regarding the energy mix, and a comprehensive energy policy will be unveiled within the next two to three weeks.”
The Phulbari coal mine in the country holds a reserve of 572 million tons of coal, out of which 472 million tons can be extracted. According to BCMCL officials, 15 million tons of coal can be extracted annually from the Phulbari mine, while 20 million tons of coal are now imported annually for the country’s six coal-fired power plants. If 15 million tons of coal are obtained from Phulbari annually, it would meet 75 percent of the demand for coal currently being imported for the nation’s thermal power plants. The feasibility study for the Phulbari mine is currently ready.
On the condition of anonymity, a BCMCL official told Bonik Barta, “15 million tons of coal can be obtained annually from the Phulbari coal mine, located just 240 meters underground, which would meet 75 percent of the fuel demand currently met by imported coal for coal-fired power plants. Once the government takes a final decision on coal extraction and completes all necessary preparations, it’ll take five years to extract coal from this mine at full capacity.”
Among the country’s five mines, coal is currently being extracted only from the Barapukuria mine, from which the Chinese consortium XMC-CMC is extracting 700,000 tons of coal annually. The Phulbari coal mine is technically ready, according to BCMCL sources. A comprehensive feasibility study has been conducted for coal extraction from this mine, indicating that 472 million tons of the 572 million-ton reserve can be extracted.
The capacity of the seven coal-fired power plants stands at 7,312 megawatts. Excluding the Barapukuria thermal power plant, the Bangladesh Power Development Board (BPDB) has to import at least 20 million tons of coal annually for the remaining six power plants. The local market value of this coal is approximately BDT 15 billion. Letters of Credit (LCs) settled for coal imports in the 2024–25 fiscal year amounted to around $1.19 billion, according to Bangladesh Bank. Calculating at a rate of BDT 122 per dollar, the import value of this coal translates to BDT 145.31 billion in Bangladeshi currency.
Coal-fired power plants account for 28 percent of the country’s total power generation capacity (including imported ones), while the demand for electricity generation is now around 17,000 megawatts. Energy sector stakeholders state that if domestic coal is extracted and these power plants are operated at full capacity, it will not only reduce import expenditures but also decrease over-reliance on gas-fired power plants.
The capacity of gas-fired power plants in the country is 12,472 megawatts. Due to the gas crisis, the Bangladesh Power Development Board is unable to generate even half of this vast capacity, and it lacks the funds to import coal to operate the thermal power plants at full capacity. Running power plants using domestic coal would consequently be both financially cost-effective and ensure uninterrupted production. But energy experts believe the government must make a definitive decision before moving forward.
M Tamim, an energy expert and professor at Independent University, Bangladesh, said, “A neutral study is required to make a definitive decision regarding the country’s coal extraction. I believe that our entire coal extraction management needs to be thoroughly examined by a neutral third party that has no vested interests. If they determine that the risks are limited and manageable without major issues, then we can proceed. And if they say the risk is too high, then we can completely abandon the idea of domestic coal extraction. One should not shy away from engineering challenges. No major project or mega project in the world has ever been executed without engineering challenges.”
Despite attempts to contact Petrobangla Chairman Md Abdul Mannan regarding the organisation’s plans for domestic coal extraction, he could not be reached.
When asked about the matter, Petrobangla Director (PSC and Operation & Mines) Engineer Md Shoaib told Bonik Barta, “Coal extraction activities are ongoing at the Barapukuria mine. There are several studies concerning that area. Based on these studies, there are plans to undertake coal extraction operations. But the process of acquiring an additional 300 acres of land on the north side of the central part of the Barapukuria coal mine is now underway. The excavation of six boreholes will soon commence for coal mining design. Subsequent initiatives for coal extraction will be undertaken in accordance with the design.”
There are a total of five coal mines in the country. Among them, Jamalganj in Joypurhat holds the largest coal reserve, standing at 5,450 million tons. Khalashpir in Rangpur holds 685 million tons, Dighipara in Dinajpur holds 706 million tons, and Barapukuria holds 410 million tons. Successive governments have been unable to decide on the extraction of these vast coal resources of the country.
Previously, when an initiative was taken to extract coal from the Phulbari mine, local residents staged protests in August 2006. The protests arose in opposition to the threat of agricultural land damage, environmental disaster, forced displacement, export and awarding the contract to foreign companies. As the protests intensified at one point, three people were killed, and many others were injured due to law enforcement gunfire.
Energy sector stakeholders note that if local people’s demands, living standards and compensation are ensured, and the broader interests of the country are properly presented to them, there remains an opportunity to utilise this natural resource.