Bangladesh favors cancellation of coal-mine deal with Britains Asia Energy

Bangladesh favors cancellation of coal-mine deal with Britains Asia Energy

Bangladesh’s prime minister’s office has asked the energy ministry to take necessary steps to scrap a multibillion dollar coal-mine deal with British company Asia Energy PLC that sparked violent protests, a news report said Saturday.

The move came after at least six people were killed by police during violent protests in August demanding that the government scrap the deal, the New Age newspaper reported.

The deal would permit London-based Asia Energy to dig an open-pit coal mine in the Phulbari area of northern Dinajpur district. Protesters say the mine’s development would displace more than 40,000 villagers and damage the environment in Dinajpur, a farming district 270 kilometers (170 miles) north of the capital, Dhaka.

Asia Energy plans to invest US$2.5 billion (�2 billion) to develop the open-pit mine. Since submitting a joint feasibility study and proposal last October, the company has been awaiting government approval to start mining operations.

The ministry will scrutinize legal aspects before moving toward scrapping the deal, the newspaper quoted the country’s energy secretary, A.M.M. Nasir Uddin, as saying.

But it was not clear when the deal would be ended, since Prime Minister Khaleda Zia’s five-year term expires in October and a new election is due in January.

“We will try to complete the procedure (to terminate the deal) as soon as possible, but all depends on the legal aspects,” Uddin was quoted as saying.

Asia Energy officials could not be reached immediately for comment.

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