PROJECT IMPLEMENTATION
Phulbari Coal Mining Infrastructure Construction and Overburden Stripping Contract
Working under the coal mine development MOU with Power Construction Corporation of China, Ltd. ("PowerChina") Asia Energy, a wholly owned subsidiary of GCM resources, has signed a contract with PowerChina International Group Limited covering mine development works of approximately US$1 billion necessary to facilitate coal extraction at the Phulbari Coal and Power Project ("the Project"). The advancement of this Contract is subject to receiving the approval of the Scheme of Development for coal mining submitted to the Bangladesh Government under the terms and conditions of its Contract for "Exploration and Mining Coal in Northern Bangladesh".
The scope of works under this Mine Construction Contract includes design, procurement, installation, construction and commissioning of mine infrastructure and overburden removal, dewatering and drainage. It also includes selective mining and stockpiling of valuable industrial mineral co-products that occur in the overburden. These co-products are expected to deliver considerable cashflow for the Project ahead of any coal extraction. The mine development is now heading in the direction of contract mining which means that the mining is carried out by an experienced mining contractor utilising their own resources and mining equipment resulting in reduced technical risk and start-up capital expenditure requirement.
The Mine Construction Contract duration is four years, with overburden removal to expose first coal taking some two years. The Company and Power China expect to enter additional contracts covering coal extraction and associated activities to support ongoing open pit mining operations and the Project's commitment to deliver high quality coal supporting at least 6,600MW power generation for over 30 years. A joint proposal with development partner, PowerChina, has been presented to the Bangladesh Government.
The Mine Construction Contract was entered into on 9th March 2024, however, issuance of a Notice to Proceed with the works is dependent on the Company receiving the necessary approvals from the Bangladesh Government and achieving financial closure.
PowerChina is committed to assist with project financing.
Coal Supply Expressions of Interest
Expressions of Interest to purchase Phulbari's coal were received from Bangladeshi Power Producers. The Chinese Ambassador has stated China's intent to assist in expanding and upgrading Bangladesh's rail infrastructure which would also enable easier transportation of surplus Phulbari coal to existing Power Plants.
The annual coal requirement is forecast to soon reach 36 million tonnes, there is scope too, to eventually extend the Phulbari Open Pit Operations into the Barapukuria field. Phulbari's expected annual production of 15 million tonnes could deliver over 40% of that requirement.
The current coal-fired power plants include:
Existing Barapukuria plants 525 MW
Payra 1,320 MW
Rampal 1,320
Matarbari 1,200 MW
STATUS UPDATES
A presentation was developed and presented to the Energy Minister of the Interim Government to reflect the aspirations of the new Bangladesh. Prominent Business leaders and Associations have been stressing the need to extract and utilise the countries' own coal. The Energy Minister has discussed the extraction of coal through open pit mining at Phulbari stating that there was a $15bn investment already on the table to realise the project. GCMs' subsidiary, Asia Energy, is continuing its work with Power China and the Energy Department to further develop the plan and timeline for the incoming governments' expeditious implementation of the Project. The Interim Government has stated that it will publish its' Roadmap for the Energy Sector by December 2025 ; this Energy Master Plan will map out the countrys' future energy needs and how to achieve them.